NEWS FROM THE U.A.E.
Excerpts from U.A.E Dailies
UAE moving closer to sales tax regime
DUBAI — 15 Feb.: The UAE is moving closer towards a non-direct tax regime with the authorities pondering measures to implement a Value Added Tax (VAT) system to offset likely revenue losses from a drop in customs fees when free trade agreements with other countries would be in place.
The move to introduce sales tax, which is in line with similar initiatives by other GCC countries, also seeks to ward off the impact of future oil revenue falls. Abdul Rahman Al Saleh, Executive Director, Business Support and Services, Dubai Customs and head of a task force conducting the study on VAT implementation, said the introduction of a non-direct tax had become imperative as an alternate source of revenue.
“Once the free trade agreements take effect, Dubai Customs will be required to substantially bring down the customs duty on various items, making it imperative for us to look for alternate sources of revenue. This influenced the move towards a non-direct tax regime,” Al Saleh added.
A recent IMF study suggested that GCC countries should implement the new tax system in two stages.
The report recommended levying of tax on selected goods like tobacco, cars and electronic items and the removal of customs duty on all imports, with the tax being collected directly from the distributors, agents and wholesalers. At a later stage, this process will be further modified to ensure that the tax is applied only at the point where the good is actually sold to the customer.
At present, there is no national sales or income tax in the UAE. Profits of international banks and energy firms are taxed at federal level, while some emirates levy limited sales taxes.
Analysts said a low VAT rate, which the GCC is expected to implement, would be a positive step for fiscal reform and is unlikely to hurt competitiveness. "The move for a tax regime despite record oil revenues may appear strange, but it reflects the growing maturity of the region's fiscal policy and is proof that peacemakers are increasingly looking beyond the current oil boom," they said.
Analysts said apart from offsetting a predicted drop in customs duty, there are other reasons why the Gulf governments are mulling sales tax. "The first concern is to reduce the impact if oil revenues fall over the medium term. The second reason is that some governments, in particular that of Oman and Dubai, faced with a contraction in oil production, are looking for additional sources of funding. Another reason is demographics. The GCC population is growing at 3.5 per cent per annum, leading to increasing demand for government services and raising the cost of subsidies."
Al Saleh pointed out that the global and regional economic systems have undergone a major transformation, requiring the UAE to adopt a fresh trade approach that is in step with the changed economic reality. "The UAE is seeking to sign mutually beneficial free trade agreements with several countries and influential economic blocks, and is already in discussions with the USA, European Union, Australia and China. The proposed changes to the country's economic system will make the UAE ready for these agreements."
Dubai Customs and the MF are jointly conducting a study that seeks to identify ways and means to implement VAT in the GCC countries. The study is being conducted in coordination with the UAE Ministry of Finance. Dubai Customs is part of the task force constituted to conduct the study on behalf of the UAE Government. The UAE Federal Government was authorised by the Secretariat-General of the Gulf Cooperation Council (GCC) to undertake the study after it submitted detailed suggestions regarding the implementation of VAT in the GCC countries. The task force will closely study various options before putting forward their final suggestions and recommendations to the GCC Secretariat-General.
The IMF in its primary report had underlined the importance of defining all taxes being paid by the private sector and the need to bring them under an integrated tax system. The report called for sector-wise categorisation of customs tariffs, so that tax rates could be fixed accordingly. The IMF report also laid emphasis on the need to ensure that the transformation to the new tax system does not lead to an increase in prices, and suggested a timeframe for GCC countries' shift towards a non-direct tax regime.
Dubai Customs' efforts towards a liberalised trade regime come at a time when the World Customs Organisation (WCO) is urging countries to remove trade barriers, including customs tariffs, in order to facilitate free trade.
Most analysts, however, said the impact of VAT on competitiveness is likely to be small. A low VAT rate is unlikely to reduce the GCC's position as a low tax destination. In the UAE, for example, there is currently no personal taxation and only international banks and gas companies pay any tax on their profits. Dubai also levies a 10 per cent fee on hotel bills.
"Economically, imposing VAT may make sense but, politically it will present challenges. A sales tax is unlikely to attract as much opposition as an income tax. More importantly, by acting now the GCC will be in a better position to deal with long term wealth issues, which could raise greater political difficulties in the future," they pointed out.
KHALEEJ TIMES
US to streamline visa processing with launch of electronic form
Abu Dhabi: 15 Feb.: The US Embassy in Abu Dhabi and the Consulate General in Dubai yesterday announced the implementation of the Electronic Visa Application Form (EVAF), in an effort to streamline visa processing for travel to the US.
Use of the EVAF will become mandatory starting March 1 and will be required for all non-immigrant visa applications of all nationalities.
Applicants must fill out online visa applications, which will display a barcode once completed. After printing out the completed form, applicants will be interviewed during a scheduled appointment. Waiting time for appointments has been reduced to two days in Abu Dhabi and six days in Dubai.
"The EVAF has been available and in use for over a year, and we have found that about 25% of visa applicants are using the EVAF form," said US Consul to the UAE, Robert Dolce. "We found it to be so beneficial for processing applications that we really wanted to push it out there."
In addition to the EVAF, the US government has taken other steps to facilitate travel to the US. Applicants for student visas and emergency medical cases do not require appointments in Abu Dhabi and are given expedited priority appointments in Dubai.
Additionally, students can now apply for visas up to 120 days before they begin their studies, as opposed to the prior 90 days, and can now enter the US up to 45 days before the start of their classes, as opposed to 30 days. This liberalisation of rules concerning visas to the US come in conjunction with previous efforts made to facilitate the visa-obtaining experience.
"Our system has proven very efficient," said Dolce. "We want to make the experience as positive as possible, and nothing is more positive than when people come and get out of there comfortably and fast."
GULF NEWS
Drunk' driver puts the blame on medicine that smells like alcohol
Dubai: 15 Feb: A woman driver claimed she took a medicine that smells like alcohol to avoid being charged with drunk driving. She is being questioned at Dubai Traffic Public Prosecution.
The public prosecutor is questioning the 31-year-old European advertising saleswoman for alleged drunken and reckless driving and damaging public property.
The woman reportedly ran on to a pavement on the Jumeirah Beach Road destroying parts of it. Witnesses told the traffic police that her car got stuck on the pavement and she couldn't escape from the scene of accident.
Interrogations revealed that she refused to go for a blood test because she claimed needles frightened her. She, however, confessed that she took liquor.
When the police suggested that she take a breath inhaler test, she confessed to the paramedics that she had had a drink but refused to go for a breath test.
The police then released her on bail and referred her case to the traffic public prosecution.
Volte face
During interrogation by the public prosecution, she changed her stand and denied that she had alcohol.
The 31-year-old claimed that she told the paramedic personnel that she took a strong medicine that smelled like liquor. The traffic public prosecutor decided to summon the policeman and the paramedic personnel for testimony.
The prosecutor agreed to release the woman on bail after depositing a Dh10,000 guarantee and depositing her passport as well as a sponsor's passport.
Motorist jailed for jumping red light
An Asian driver who jumped a red traffic light and hit another car has landed in jail.
The Dubai Traffic Court of First Instance sentenced the Asian driver, identified as N.I., to one month in prison.
In their statement to the public prosecution, both drivers stressed that they skipped a red light. The Dubai Traffic Public Prosecution charged N.I. with reckless driving, jumping a red light and causing moderate damages to the other car.
GULF NEWS
Sailor beaten to death in oil tanker over ‘cartoons’
FUJAIRAH/DUBAI — 15 Feb: A sailor was allegedly beaten to death by his colleagues on board a Norwegian oil tanker in the international waters off the coast of Fujairah, following an argument over the blasphemous cartoon published on Prophet Mohammed in a Danish daily recently. According to reliable sources, the fight among the seamen, which caused the death of one sailor, emerged after an argument between them over their differences of opinions over the slanderous and blasphemous cartoon on Prophet Mohammed.
A source from the Indian Consulate in Dubai confirmed the death of 31-year-old Sudheer Nonia Jagannathan, hailing from Mumbai, but refused to comment on the issue. “We had been informed about the death. Our officials visited the Fujairah Hospital and collected the details. The investigation is going on and once it is over, the consulate will render all the help to repatriate the body.”
The source disclosed that all the crew in the ship was from India. The ship was coming from New Manglore Port in Karnataka in India to Fujairah with chemicals. The deceased was working as a fitter on the ship. The death was likely caused by foul play as traces of beaten and smashed skull was detected in the a post-mortem at the Fujairah Hospital. The sources said the body of the allegedly murdered man was found by the inspection squad, lying on the deck of the vessel with traces of beating on different parts of his body.
The authorities concerned in the UAE were informed about the incident, as it was the closest land from the international waters where the incident took place in the oil tanker. The body of the dead man was taken to the morgue of the Fujairah Hospital, and all people on board the ship were apprehended. “After examining the body, traces of beating marks were found on the head, asphyxiation and teeth bites on the shoulder. Medical check-up also revealed clear smashing on the skull” said the source.
When ‘Khaleej Times’ contacted the captain of the oil tanker, he denied any foul play in the incident, even though he and his crew members were remanded to the custody of the Fujairah Police.
KHALEEJ TIMES
Two men trapped in ditch; rescue efforts on
ABU DHABI — 15 Feb.: The fate of two men who fell into a ditch at a development project here was hanging in balance last night, as rescue teams were struggling to get them out of the 40-metre-deep hole.
The incident occurred in the Mushref area of the capital city where a development project is located. The two men are believed to be Asians.
Colonel Khalid Al Dosari, Director of Ambulance and Rescue at Abu Dhabi Police, said people living in the vicinity heard loud cries of the two men and quickly alerted the authorities. Rescue teams were rushed to the site at around 11pm.
He said the rescue operations could continue till early this morning.
It was not clear whether the two men were still alive, as oxygen levels in the deep ditch could be low, the official told Khaleej Times at around midnight.
KHALEEJ TIMES
Electronic services by SNRD
SHARJAH — 15 FEB.: Aiming at better serving the public, the Sharjah Naturalisation and Residency Department (SNRD) is launching electronic programmes and services. Lieutenant Colonel Abdullah Ali Sahoo, director of the department said that the department is keen to provide distinguished services to the public.
Following that, the department introduced electronic programmes, and is training staff to help provide such modern services to the clients of the different sections. This was during his first inspection visit to the department’s sections yesterday. He has visited the Visa, Follow and Investigation, and Finance and Administration departments. He reviewed the work mechanism at the department as well as the offices of the Eastern Zone.
Lt. Col. Sahoo hailed the efforts of the officers and employees and the achievements of the different sections. He noted that developing the services has become an essential requirement for achieving modern administration. He stressed that the department will apply all possible means to solve problems, facilitate procedures, and finish transactions in standard time.
KHALEEJ TIMES