Our Middle East Tax Newsletter aims to provide you with regular updates, insights and practical guidance on the tax implications of doing business in the region.

In this issue, we provide a roundup of the current status of Value Added Tax (VAT) and the most recent tax related developments across the Gulf Cooperation Council (GCC), as well as their implications on the financial position of businesses.

On 14 October 2020, the UAE Federal Supreme Court passed its judgment on an appeal filed by the UAE Federal Tax Authority (FTA) in relation to the Court of Appeal’s judgment concerning the imposition of penalties resulting from a voluntary disclosure. The case was handled by a UAE local law firm on behalf one of the UAE’s largest financial institutions.

The Abu Dhabi Court of First Instance recently dismissed an appeal filed by the Federal Tax Authority (FTA) against fines and penalties imposed by the FTA against a UAE company, a Dubai based beverage distributor, in connection with excise taxes. Baker McKenzie Habib Al Mulla represented the company. The court also ordered that the FTA repay the full amount of the penalties to the company. The Tax Dispute Resolution Committee had previously ordered the reduction of tax penalties levied on the company from the amount of AED 20.8 million to AED 8.8 million. The FTA appealed to the Court of First Instance against that decision. Baker McKenzie Habib Al Mulla had also represented the company at the Tax Dispute Resolution Committee, and the company counter appealed that no penalties were legally due. The Court of First Instance rejected the FTA’s appeal against the decision of the Tax Disputes Resolution Committee, and allowed the company’s appeal that no penalties should be due.

Download issue Optimizing your cash flow and managing VAT in contract cancellations The COVID-19 pandemic continues to have a heavy impact on the global economy. The spread of the virus is constraining the supply and demand of goods and services. As a result, companies are considering the potential cancellation of…

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