Printer Friendly

GCC value-added tax framework provides roadmap for Qatar: KPMG.

Norr: Detailed framework.

Following the release of the unified agreement for value-added tax (VAT) for the Gulf Cooperation Council (GCC) countries by Saudi Arabia, Philippe Norr, head (Indirect Taxes) at KPMG in Qatar, stated "this milestone was paving the way for the implementation of VAT in 2018."

It also provides companies with a sufficiently detailed framework to start preparation for VAT in 2018, manage risks and capture optimisation opportunities.

In principle, VAT will be levied on the supply of goods and services at a standard rate of 5%. Certain supplies of goods and services are to be zero-rated or VAT exempt (not taxable but also with no right to recover VAT paid).

Based on the framework agreement, each GCC member state (including Qatar) will now need to issue its' own domestic legislation to locally implement VAT.

Norr also anticipates that the authorities in Qatar, having been part of all GCC level discussions, will prepare and release the local legislation on VAT in time for implementation of VAT in 2018.

"This legislation will provide details on how Qatar will interpret the GCC framework and deal with key matters where it has discretion. These will include whether to treat certain supplies as zero-rated or VAT exempt. The local law will include details on the conditions for VAT deductions, VAT grouping, transactions assimilated with taxable supplies, record and reporting requirements and further definitions to enable a correct VAT treatment by companies of their supplies and overall business environment," he said.

"VAT will impact all businesses in Qatar and outside Qatar, either directly or indirectly. Today, companies need to think carefully about their procurement processes, operating models, customer and suppliers' alignment, legal structure and systems to be well prepared for this significant development that is set to change the business landscape. But the upcoming changes not only raise a need for risk management, they also allow companies to implement steps around cost, process and systems optimisation", Norr said.

It is possible that VAT may increase the cost of doing business but revenues gained from VAT will be re-invested back into the economy and support long-term development.

"Qatar has long been considered an attractive low-tax environment, especially for businesses looking to invest in the GCC region. Generally, the introduction of a broad based consumption tax at a low rate is not expected to deter investment into Qatar, or the GCC region," Norr added.

[c] Gulf Times Newspaper 2017 Provided by SyndiGate Media Inc. ( ).

COPYRIGHT 2017 SyndiGate Media Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2017 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:Gulf Times (Doha, Qatar)
Geographic Code:7QATA
Date:Apr 26, 2017
Previous Article:QIIB bags Visa award for 'Best growing Qatari bank in the banking card industry in 2016'.
Next Article:Bank ethics and regulation on the spotlight.

Terms of use | Privacy policy | Copyright © 2019 Farlex, Inc. | Feedback | For webmasters