The seemingly never-ending deliberations over the proposed introduction of a value-added tax in the Gulf Cooperation Council (GCC) countries must be testing the patience of taxpayers to the limit. Will they? Won’t they? Will they? Won’t they? It’s almost like the plot of a soap opera! Perhaps this time they will. We were informed by UAE Deputy Ministry of Finance Younis Al-Khouri last week that the GCC is near an agreement that could see VAT introduced in 2018. However, I wouldn’t hold your breath. We’ve heard such pronouncements on many occasions over the last few years.
The reason most often cited for the delay is that some GCC member states are less prepared than others, technically and administratively. However, surely they have had long enough now to complete the necessary preparations? After all, this idea has been on the drawing … Read More »
BEPS may be changing the international tax landscape irrevocably – whether for better or worse being a matter of intense debate – but the allure of offshore and low-tax financial centers remains as strong as ever. For example, the little island of Guernsey, which at just 78 square kilometers in area is over half the size of Washington DC, is now home to more non-UK entities listed on the London Stock Exchange than any other jurisdiction globally. In fact, the UK Crown Dependencies (Guernsey, Jersey, and the Isle of Man) all play a hugely important role in funneling investment into the capital markets of London, and the wider economy of the UK. One-third of the Chinese companies listed on London’s Alternative Investment Market (AIM) were incorporated in Jersey in 2014, up from one-quarter prior to 2008. LSE data also shows … Read More »
There is a trend taking place that is seeing tax shifted away from income and labor, and onto consumption, which seems to be a good thing. Even though consumption taxes tend to be regressive, a lot of economists agree that this tax shift will encourage economic growth and secure governments’ tax bases. Yes, Romania has just bucked the trend, but that may be to its competitive advantage. Few countries in the EU now have standard rates of VAT of less than 20 percent, and many have pushed VAT rates well above that level.
Most of the countries that have recently increased VAT did so in response to the calamitous effect the financial crisis had on national budgets. Now things have stabilized somewhat, few have shown much inclination to reduce VAT rates, except Romania. But maybe its decision to cut VAT will … Read More »
Prime Minister Narendra Modi’s Government has said all the right things to foreign investors about tax since it has been in power, and has made steady, if unspectacular, progress towards improving the country’s notoriously difficult corporate tax environment. However, it’s been said for some time that the pending goods and services tax legislation, which is widely acknowledged as the most important tax reform since independence, would be a litmus test of the Government’s reformist credentials. And unfortunately, it is a test that it appears to be failing. To be fair to the Government, it’s not for lack of effort. But there’s not much it can do when the Opposition (largely made up of the Congress Party), uses its majority in the Rajya Sabha (upper house) to oppose for the sake of opposing, which appears to have been the case during … Read More »