According to senior International Monetary Fund officials, VAT is likely to be introduced at different times across the GCC region. They had intended to introduce VAT simultaneously in January but so far only Saudi Arabia and the UAE look like they will do so. When it is introduced VAT will be introduced at 5%. It will require significant administrative and technical changes including detailed regulations and making sure all affected companies are registered. However all six GCC states remain committed to introducing it.
Saudi Arabia’s Justice Minister, Walid Al-Samaani has announced the Kingdom’s commercial courts have officially launched. There are three commercial courts in the Kingdom and they are in Riyadh, Jeddah and Dammam. It is hoped they will encourage investment in the country in line with the Saudi Vision 2030. Specialist commercial chambers have also opened in the public courts in several Saudi cities.
The UAE’s Finance Ministry has announced it is developing the Implementing Regulations to the Federal VAT Decree-Law. The VAT rate on all taxable and exempt goods, exports and services is yet to be announced. The relevant Regulations will be published in the Official Gazette.
Bahrain’s Central Bank has announced it is going to establish a dedicated Fintech Unit to ensure the best services are provided to individual and corporate customers in the financial sector. The announcement was made following the Bank’s latest Board meeting. The proposed Unit will be responsible for approving companies’ participation in the Regulatory Sandbox. It will also supervise licensed companies’ activities and operations, including cloud computing, payment and settlement systems, and monitoring technical and regulatory developments in the fintech field.
Saudi Arabia’s Crown Prince and Deputy Prime Minister has announced the Kingdom is going to establish the world’s first independent economic zone. The Neom zone will extend across Egypt, Jordan and Saudi Arabia, will cost $500 billion and cover 26,500 square kilometres. It will focus on energy and water, mobility, biotech, food, technological and digital sciences, advanced manufacturing, media and entertainment. It will be open to private and public investors as well as partnerships and will be powered by renewable energy.
KSA: Confirmation that all companies will be subject to VAT if their annual revenue is at least 375,000 SAR
Saudi Arabia’s General Authority for Zakat and Tax has confirmed all companies operating an economic activity will be subject to VAT if their annual revenue is at least 375,000 Riyals. The Authority added all companies whose annual revenue exceeds a million Riyals should register before 20 December 2017. However, companies with annual revenue between 375,000 and a million Riyals can register by 20 December 2018.
Abu Dhabi’s Environment Agency together with Abu Dhabi’s Centre of Waste Management has published a Sustainable Construction and Demolition Waste Management in Abu Dhabi Guide. It provides guidance on steps to be taken by companies in the construction sector to reduce the amount of waste they produce on site. It also addresses how they can take responsibility for the collection, segregation, transfer and disposal of their waste. According to Statistics Centre Abu Dhabi, the total amount of waste generated in Abu Dhabi has been growing rapidly in recent years. The official figure for 2016 was about 9.69 million tonnes of solid waste produced or more than 26,000/day.
According to local newspaper reports, Oman’s Shoura Council has issued a Decision halving the minimum wage requirement for expatriate workers who are looking to bring their family to the Sultanate with them. The wage requirement has been cut from 600 to 300 Rials. The change comes as the country looks to diversify its economy through its Tanfeedh programme.
Qatar’s Civil Aviation Authority (QCAA) and the European Aviation Safety Agency (EASA) have signed an agreement to cooperate on regulatory and aviation safety issues. The agreement aims to enhance collaboration to improve safety and harmonise global aviation including information, knowledge and expertise sharing and regulatory cooperation. It was signed for the EASA by its Executive Director, Patrick Ky and for the QCAA by its Chairman, HE Abdulla Nasser Turki Al Subaey.
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Written Dr Marjan Atashi Golestan is a Visiting Professor of Law at University of Allameh Tabatabaei and Industrial Management Institute of Iran (IMI) who has carried out a specific and detailed study of the law impacting overseas companies and investors who wish to set up and operate in Iran.
The legislative position in Iran in this area is not always clear and some of the legislation can be confusing when looked at in isolation. As a result Dr Golestan has carried out extensive research including reviews of associated parliamentary debates and provides information on the practice on the ground to clarify the position.
A key point for those investing in Iran is whether they want protection from potential nationalization and expropriation, so the benefits and requirements for registration under this regime is discussed extensively, along with differences between onshore and freezone operations, intellectual property concerns, visa requirements for expatriate staff and business owners, taxation and dispute resolution options.