VAT is coming to the United Arab Emirates. Is your business ready? Whitehall Resources work with Oracle Financials Consultants, many of whom are qualified Accountants based locally in the GCC, who can help your business on VAT implementation best practice. Read more…
The United Arab Emirates has come under increasing pressure to reduce its budget deficit and improve its long term economic standing. Since 2014, the oil price has plummeted to $45-$55 per barrel which leaves the UAE with a large budget deficit which needs to be addressed. In August 2015 the first step to reduce costs was taken when the UAE announced they were eliminating fuel subsidies.
Whilst reducing costs, the governments of the UAE are also looking to diversify and increase their income. Corporation and personal tax were considered but not changed as this would have reduced foreign investment and discouraged the skilled foreign workforce. VAT however, is seen as an efficient way to raise tax revenues, cheaper to operate, less open to fraud and less likely to impact investment decisions.
Following advice from the IMF, the UAE agreed to implement VAT on most goods and services, starting January 1st 2018. This is a wide-reaching decision and one which will affect all businesses, big and small. There will be a great deal of work to be done preparing business processes and ERP systems. They will need to:
- Understand the likely impact of VAT on the demand for their goods and services
- Understand their VAT registration obligations and the process of applying for a VAT number
- Understand when VAT needs to be paid and charged, and ensure records are properly kept
- Changing terms of business to ensure VAT becomes a cost to consumers not suppliers
- That accounts teams understand when VAT should and should not be charged
- Altering Oracle systems to ensure they can copy with charging and recovering VAT
- Changing invoice templates
If you are preparing for the implementation of VAT, Whitehall Resources are here to help. As the leading specialist supplier of Oracle ERP professionals in the region, we have an extensive network of experienced Oracle Financial Consultants built across our 9 years of business in the Middle East. Contact us to find out more.