This last quarter has seen a lot of talk about Value Added Tax as a result of the announcement that the UAE would be implementing VAT in January 2018, which is not that far away. There must have been some sighs of relief to learn that VAT would not be levied on school fees or medical services, two large expenses for families and companies. Companies will need to assess the flexibility of their accounting systems to be able to account for VAT – companies will be acting as a collection agent for the Government and therefore cannot include VAT on sales in their revenue lines. There will be the added complexity for those companies for whom some of their sales will attract VAT and others will not – for example if certain foodstuffs are exempt or certain school related items. There will in all likelihood have to be a VAT registration process also. So it will be best to be well prepared.
Another recent development I have seen reported is the agreement by the UAE banks Federation to support SMEs that are in difficulty with bank loan repayments. As with most economies, SMEs form the backbone but paradoxically often find financing to be one of their biggest challenges. A plan to alleviate the distress that is often caused in challenging economic times and one that will reduce the “flight” reaction is most welcome as it will benefit not only the companies directly affected but their suppliers, customers, employees and their families.
The interview featured in this issue is with Mr. Hussein Adamally of SwissArabian Perfumes Group. We also have an update on the Sultanate of Oman’s and on the Indian Union Budgets for 2016
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