The base formula: CIF
Every import calculation starts from CIF: the car's price plus freight plus marine insurance. From Dubai, ro-ro shipping runs about AED 3,200 and a container about AED 5,200; marine insurance is 1.5% of the car's price.
On top of CIF come the two big items: import duty (a percentage of CIF set by fuel type and engine size) and VAT at 10% — charged on CIF plus duty, not on the car price alone.
Duty rates — free zone vs mainland
| Car type | Free zone | Mainland |
|---|---|---|
| Electric | 2% | 4% |
| Hybrid up to 2000cc | 4% | 15% |
| Hybrid over 2000cc | 5% | 15% |
| Petrol up to 1500cc | 6% | 50% |
| Petrol 1500–2000cc | 6% | 60% |
| Petrol 2000–2500cc | 6% | 75% |
| Petrol 2500–3000cc | 8% | — |
| Petrol over 3000cc | 10% | — |
Example 1: an AED 60,000 car to a free zone
| Item | AED |
|---|---|
| Car price in Dubai | 60,000 |
| Ro-ro freight | 3,200 |
| Marine insurance (1.5%) | 900 |
| CIF | 64,100 |
| Duty 6% (petrol under 2500cc) | 3,850 |
| VAT 10% of (CIF + duty) | 6,800 |
| Fixed fees | 2,400 |
| Approximate free-zone total | ≈ 77,100 |
Example 2: the same car to the mainland
The same AED 60,000 car, petrol in the 1500–2000cc band, bound for the mainland: 60% duty is about AED 38,500, VAT about 10,300, and with AED 3,900 of fixed fees the total lands at roughly AED 116,700 — nearly forty thousand dirhams more than the free-zone route for the same car.
The big trap: free zone first, national plate later
What this calculation does not include
- The zone's own charges (technical standards, environment certificate, plate issuance, third-party insurance, municipal fees) — quoted per zone and per car
- Any Iranian import permit or quota
- Storage or demurrage if clearance drags
- Repairs required at inspection
- The exchange rate you actually get on the day
Why is VAT more than 10% of the car price?
Because its base is CIF plus duty, not the car price alone — the detail that breaks most back-of-envelope estimates.
This article is general information, not legal or financial advice. Rules change — confirm your own position with a qualified professional before deciding.
