News Ticker

GCC moves towards value-added tax #gcc #taxation #economy

800px-Persian_Gulf_Arab_States_english

 

Reportedly, the Gulf Cooperation Council (GCC) has agreed on the implementation of a taxation system in the region, an official from the UAE finance ministry said on Monday.

The six countries – which doesn’t apply almost any form of taxation – will introduce tax on the value added to a product, material or service (VAT) within three years and that it would take 18 to 24 months to implement the reform once a final agreement has been reached, officials say.

Apparently, the rising pressure on gulf governments to provide infrastructure to their citizens incited the GCC to work for the reform, but it’s evident that this comes after last year’s drop of oil price, which dramatically cut governments incomes and urged gulf countries to find other ways to increase revenue.

Younes Haji Al-Khouri, undersecretary at the UAE ministry of finance, said that zero tax will be applied on health care, education, social services sectors and 94 food items, while the VAT rate has not been decided yet, having the International Monetary Fund only suggested that the UAE should consider imposing it at a 5 percent rate.

Valentina CALCAGNO

Advertisements
%d bloggers like this: