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Cheapest payment gateway for UAE business ? 1.99 % - Any cheaper?

That is not going to happen. You can't both safe in taxes and get cheap business services. I don't even know if there is a bank there that is handling card processing for online merchants.
 
Have a look at Telr they have best rates and 3 tier plans
Do you have a URL for this service you recommend and do they accept UAE companies ?