UAE’s Federal Tax Authority (FTA) has developed its e-services to include new features allowing taxable persons to link their accounts with an accredited tax agency, authorizing it to carry out registration procedures, submit tax returns, and complete tax transactions on behalf of the taxable person, who is kept posted with real-time updates.
The FTA explained that this update was introduced to answer requests submitted by taxable persons and businesses registered with the Authority. The new features allow taxable persons to nominate one or more persons as their tax agents, who would then represent them in all their transactions with the Authority, and help them comply with their tax obligations and exercise their rights. A taxable person can link their account on www.eservices.tax.gov.ae with that of an accredited tax agency with a simple procedure outlined on the FTA website. “The Federal Tax Authority is committed to continuously developing its services to ensure flexibility and enable businesses to seamlessly implement the tax system and avoid any disruptions to their activities,” said FTA director general Khalid Ali Al Bustani. “An FTA-accredited Tax Agent can be appointed by any natural or legal person to represent them with the Authority, and help them comply with their tax obligations and exercise their rights.” “The FTA has prepared and published a number of guides covering all legislative and executive aspects of the local tax systems,” Al Bustani added, noting that the Authority has approved 87 tax agents who successfully met the technical requirements and qualifications and passed the FTA’s exams. “The Federal Tax Authority has set up advanced, world-class electronic procedures, and hired highly qualified personnel to facilitate registration procedures for taxable persons, tax agents and tax agencies alike,” he concluded.
The FTA clarified that for a tax agent to be authorized to carry out their mandate, they must be affiliated with a tax agency – such as an accounting firm, a tax or legal consultancy, etc. – registered with and accredited by the Authority. Tax agents must also register with the FTA as a tax agent, even if they were already registered as a taxable Person for Excise Tax or Value Added Tax (VAT). The Agency is then issued a Tax Registration Number (TRN).
No VAT impact on construction sector in UAE
The UAE’s construction industry will witness over 10% expansion in 2018, according to industry executives and research reports.
The UAE’s construction industry has not been impacted by the recent introduction of 5 per cent value-added tax (VAT) and it will witness over 10 per cent expansion in 2018, the second-fastest growth rate in the world, according to industry executives and research reports.
The industry executives believe that Expo 2020 is not the end for the construction sector. Rather they are pinning hopes on multi-year plans such as Vision 2021 which would drive the industry in the post-Expo 2020 era.
Ravi Murthy, chief financial officer, Arabtec Construction –
Attributed the strong growth potential for the industry to the hosting of Expo 2020 as well as growth in the hospitality and healthcare industries, with a massive inflow of visitors and medical tourists.
“Dubai has won the bid to host the World Chamber Congress which is coinciding with Expo 2020. More than 14,000 chambers from 100 countries will attend the event. If 10 per cent of those chambers do business, the requirement for hotels, infrastructure, road, entertainment, leisure and shopping is going to grow substantially. The UAE target is half a million medical tourists. As compared to the West, they are in the stage of implementation; there are about 43 hospitals with more than 100 beds, which is not enough to cater to the needs. There is a big potential for healthcare. Today, we have Dh740 billion worth of construction projects under way,” he said.
Murthy pointed out that banks are more liquid now. “Though, banks have become cautious their doors are open for tier 1 and tier 2 contractors and developers.”
A massive construction activity is taking place in Dubai World Central, Healthcare City and Dubai Investment Park.
“Most contractors booked their purchase in advance. However, the industry has the ability to absorb the additional cost. The impact of five per cent VAT is more psychological as the increase is not a huge amount. In other countries, VAT ranges from 10-15 per cent of the bill amount,” he said.
“What affects the construction sector more is the price fluctuation of the building materials – such as cement, steel rebar’s and wood products, in addition to the six-month deferred payment by the clients. Payment delay multiplies our woes, more than VAT,” Rahman added.
According to global consultancy Arcadis’ latest report, the upcoming Expo 2020 should lead to an increase in construction activity as the Emirate prepared for the event and the legacy delivery of District 2020. In Abu Dhabi, there is a continued focus to accelerate diversification and shift dependence away from oil revenues, providing opportunities for the private sector to create wealth.
It forecasted that the UAE construction will be the second fastest growing market in the world in 2018 with 10.2 per cent after Qatar at 15 per cent. The study predicted that Abu Dhabi and Dubai were among the 20 most economical cities for construction costs, cheaper than GCC cities such as Jeddah and Riyadh.
Another study by Marmore Research has predicted that the GCC will need 6.16 million housing units by 2022, led by Saudi Arabia (3.96 million), UAE (0.98 million), Kuwait (0.47 million), Oman (0.4 million), Bahrain (0.2 million) and Qatar (0.15 million).
“At presence, there is an oversupply of real estate assets across all sectors in parts of Dubai and Abu Dhabi, following the completion of several new master planned developments. This may result in a need to consider change of use, refurbishment, or the disposal of older buildings”.
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