GCC Indirect Tax Weekly Digest

April 14, 2022

UAE developments 

Abu Dhabi General Administration of Customs launches advance ruling tool for classification and rules of origin

The advance ruling tool for classification and rules of origin is an innovative electronic system for managing advance ruling decisions which have been implemented by the Abu Dhabi General Administration of Customs. 

This system is a move that will strengthen the customs authority’s efforts. It will facilitate the trade by allowing the commercial community to obtain an advance ruling for goods prior to importation through the various Ports of Entry in the Emirate of Abu Dhabi. 

This will speed up the release of goods at the borders, reduces customs clearance times, saves costs and time and assists the Abu Dhabi General Administration of Customs in providing the best services to the trade community in Abu Dhabi and the United Arab Emirates (UAE).

New Economic Collaboration between the UAE and Kuwait establishes a Virtual Trade Corridor to enable smoother procedures and accelerate trade

Under the direction of the Department of Economic Development – Abu Dhabi, the Abu Dhabi ports group has signed a Memorandum of Understanding (“MoU”) with the Kuwait General Administration of Customs to develop a new virtual trade between the UAE and Kuwait (ADDED).

This collaboration aims to build new regulations, procedures, and system integrations to enable virtual trade, which will make cross-border trading even easier and more convenient. Moreover, customs authorities in both countries will have access to pre-arrival information for international cargo movements, cross-check the information faster and promote pre-clearance of goods.

The MOU will also establish faster procedures for expediting perishable commodities exports, lowering border stay time. The digital integration also offers substantial safety and security implications, as it gives authorities better visibility into any potential hazards linked with items moving between the two countries, as well as lowering inspection rates and simplifying procedures for those who possess authorizations.

FTA publishes guide on Tax Obligations

The United Arab Emirates (UAE) Federal Tax Authority (FTA) has published a guide titled ‘Getting to know your Tax Obligations’.

The guide summarizes the Value Added Tax (VAT) obligations that businesses in the UAE may be subject to.

A wide range of topics are covered at a high level, including registration obligations, VAT rates and requirements for zero-rating/exemptions, invoicing, tax groups, blocked input tax, recordkeeping requirements, and VAT return filing.

The guide provides a clear and accessible introduction to a variety of important VAT concepts, and may be particularly helpful to those who are new to VAT in the UAE. For more detailed guidance on a given topic, the FTA’s detailed VAT guides on specific topics may be consulted.

FTA briefs the Bahraini delegation on Marking the Tobacco and Tobacco Products Scheme

The FTA held a joint virtual meeting with a delegation of officials from the Bahrain National Bureau for Revenue (NBR).

NBR officials were provided with a briefing by the FTA on the Marking Tobacco and Tobacco Products Scheme, presenting the objectives, scope, steps, and results of implementing the first and second phases of the Scheme, as well as the practical aspects and challenges. 

The Scheme is intended to prevent the sale and possession of unauthorized cigarettes, waterpipe tobacco, and electrically heated cigarettes that do not bear Digital Tax Stamps.

The meeting between the FTA and NBR indicates that tax authorities of the Gulf Cooperation Council (GCC) countries are collaborating extensively on various aspects of the development of the tax systems in the GCC.

KSA developments 

Jadeedah Arar Port set for infrastructure enhancement to boost trade

The Kingdom of Saudi Arabia (KSA) Zakat, Tax and Customs Authority (ZATCA) has announced a proposed plan to develop supporting infrastructure at the Jadeedah Arar port. 

This new project is expected to provide improved logistics support at the port i.e., warehousing facilities, housing for laborers, retail outlets amongst other facilities.

The project is expected to be fulfilled by collaborating with the private sector. This will further enhance trade activities within the port particularly between Saudi Arabia and Iraq. 

For further information on this development, click here.

This digest is for information purposes only and should not be construed as advice. It does not necessarily cover every aspect of the topics with which it deals. You should not act upon the contents of this alert without receiving formal advice on your particular circumstances.

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