UAE among 20 least complex tax jurisdictions in the world
The UAE's rise in complexity this year is largely driven by the introduction of the emirates' first VAT in January 2018.
The UAE is among the 20 least complex jurisdictions in the world for accounting and tax compliance, new data revealed on Wednesday.
The UAE came in at 74th, indicating an increase in complexity since its 2017 inaugural ranking of 92, according to TMF Group's Financial Complexity Index 2018.
The UAE's rise in complexity this year is largely driven by the introduction of the emirates' first VAT in January 2018, said TMF Group's regional director for Middle East and Africa Jonathan Wheeler.
"The VAT is a fundamental change to the way businesses operate locally. The transaction tax is embedded in virtually all functions of a company; from sales contracts to accounting and bookkeeping. So it is an important one for businesses to document and report correctly," Wheeler said.
"While the UAE may not be on our 'top 5 easiest' list in this year's Financial Complexity Index, it remains at 74th, one of the less complex jurisdictions globally for accounting and tax compliance - and a very attractive market for business," he said.
China is at number one, while the Cayman Islands at 94 is once again the least complex jurisdiction for financial compliance, the leading provider of global business and compliance services said.
The UAE is also on the verge of getting listed among the world's top 20 countries in "ease of doing business", according to the latest rankings by the real estate consultancy Knight Frank. The UAE, one of the world's leading destinations for foreign direct investment, has moved up 5 spots to be placed 21st. Recently, the UAE was named the 13th Most Promising Home Economy for Investment in 2017-19 according to a survey conducted by the United Nations Council for Trade and Development (UNCTAD) and Investment Promotion Agency (IPA) Observer.
TMF's head of EMEA Juraj Gerzeni said the adjustment period for companies operating in the UAE - and Saudi Arabia - is very much ongoing, as 4 GCC countries are yet to implement the VAT. When they do, special rules for inter GCC transactions will begin to apply.
"When it comes to cross-border business success, knowing and understanding the local requirements for financial compliance can prove vital. Seeking the support of in-country experts, such as TMF UAE, allows companies of all sizes to maintain focus on their core business," Gerzeni said.
TMF has ranked 94 jurisdictions across Europe, the Middle East, Africa, Asia Pacific and the Americas; 1 being most complex through to 94 the least complex. - firstname.lastname@example.org
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