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News from the Arab world

Emirati-Italia: prime iniziative verso Expo Dubai 2020

E’ stato costituito dal Governo italiano il Commissariato Generale dell’Italia per Expo Dubai 2020 con il compito di assistere il Commissario generale di Sezione nelle attività di progettazione e realizzazione della partecipazione del nostro Paese alla prima Esposizione Universale nel mondo arabo, dedicata al tema.

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Tunisia-Italia: Sideralba inaugura impianto a Biserta

Sideralba Maghreb ha inaugurato ufficialmente l’impianto di 100.000 m² per la realizzazione di acciaio di elevata qualità. Al taglio del nastro hanno partecipato oltre a Tommaso e Luigi Rapullino, il Ministro dell’Industria tunisino Slim Feriani, il Governatore di Bizerte Mohamed Gouider l’ambasciatore italiano Lorenzo Fanara, una nutrita schiera di ospiti.

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Arabia Saudita-Italia: Roberto Cavalli firmerà residenze di Mirabilia

Roberto Cavalli ha stretto un accordo con Dar Al-Arkan, il più grande real estate developer quotato in Borsa dell'Arabia Saudita: è la prima intesa del genere per la griffe in Arabia Saudita.

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News from Italy

Bank of Italy sees NPLs falling

Italy’s stock of net non-performing loans (NPLs) will fall to 130 billion euros ($154 billion) in the coming months, equal to 7.2 percent of total loans, the Bank of Italy said on Thursday.

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Italia: Ramzi Zawaideh nuovo Presidente delle compagnie aeree arabe in Italia

Ramzi Zawaideh, Country Manager di Royal Jordanian, nuovo Presidente delle compagnie aeree arabe in Italia (Board of Arab Airlines Representives in Italy).

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JIACC's Tax Commission

Kuwait / VAT ratification postponed 

In an official statement made by the Head of the Kuwaiti Parliament Budget Committee, the statement indicates the government’s intention to postpone VAT and accelerate Excise Tax.

The Minister of Finance requested an acceleration of the parliamentary ratification of the GCC Excise Tax Agreement. The Government hopes that ratifying the excise tax agreement goes smoothly since it is to be implemented as a sin tax on goods that harm the human health or the environment. Such goods include carbonated drinks, energy drinks and tobacco products. In addition, according to art. two of the GCC excise tax agreement, the tax can be implemented on luxurious items. The Minister hopes to ratify the GCC excise tax agreement shortly. The Excise Tax is expected to generate 200 million Kuwaiti Dinar.

At the same time, the Minister postponed the request to ratify the GCC Value Added Tax Agreement until 2021. It is worth noting that the chosen of date is not coincidental, it meets the date of the next parliament election expected in November, 2020. Many current Parliament members announced they are against levying taxes on citizens. The request for postponement is in response to the Government’s careful reading of the inhospitable political environment toward levying taxes in the State.

Source: Official website of Kuwait National Assembly available in Arabic.

http://www.kna.kw/clt-html5/news-details.asp?id=30070

Author: Sarah Al-sultan, SJD candidate at University of Virginia School of Law

Bahrain joins the OECD BEPS “Inclusive Framework” 

Bahrain has now joined the OECD Base Erosion and Profit Shifting (BEPS) inclusive framework.

The “Inclusive Framework” was established in January 2016, to develop a more inclusive framework with the involvement of interested non-G20 countries and jurisdictions. By joining the Inclusive Framework, Bahrain will be working on an equal footing with all other Inclusive Framework members on the implementation of the BEPS package and on developing further standards to address the remaining BEPS issues.

In the last few months, Bahrain has been moving steadily towards the achievement of the OECD and other standards. Importantly, the achievements of OECD standards is relevant also in the EU delisting process (see the JIACC special Tax Newsletter) that is conditional upon achievements of some objectives, one  of which is joining the BEPS Inclusive Framework.

Furthermore, with Law N. 13 of 2018, on 26th of April Bahrain ratified the Multilateral Convention on Mutual Administrative Assistance in Tax Matters (and the 2010 amending Protocol) and deposited the Instrument of Ratification with the OECD on 3 May, 2018. On the same date (26 April 2018), with Law N. 14 of 2018, Bahrain ratified the Multilateral Competent Authority Agreement‎ on Automatic Exchange of Information Agreement (the CRS MCAA) on the introduction of Automatic Exchange of Information in tax matters on a reciprocal basis.

The BEPS inclusive framework joins countries and jurisdictions collaborating for the implementation of the OECD/G20 BEPS package that will establish a (i) monitoring process and a (ii) review mechanism.

Hereunder a list of JIACC States that have (or have not) joined the BEPS Inclusive Framework:

YES: Bahrain / Egypt / Djibouti / Kingdom of Saudi Arabia / Italy / Oman / Qatar / Syria / Tunisia

NO: Algeria / Comoros Island / Jordan / Iraq / Kuwait / Lebanon / Lybia / Mauritania / Morocco / Palestine / Syria / Somalia / Sudan / United Arab Emirates / Yemen

 Author: Roberto Scalia, Chairman Tax Commission

OECD - IFG / Draft on BEPS in the Mining Sector 

The OECD and the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF) have published a consultation Draft on “Limiting the Impact of Excessive Interest Deductions on Mining Revenue”.

Base Erosion and Profit Shifting (BEPS) – often combined with gaps in the capabilities of tax authorities in developing countries – threaten the possibility for countries rich in natural resources to effectively raise revenues. One of the methods that is widely employed in this context is the use of excessive interest deductions.

The Draft addresses some noteworthy schemes, namely, (i) Debt “Push-Down” structures; (ii) Loan Term contingent on Host country Tax Law; (iii) interest rate mark-up; (iv) the Use of Hybrid Instruments; and (v) combined asset purchase and financing.

The Draft analyses the challenges arising from such schemes and puts it vis-à-vis the interests limitation rules already provided in domestic tax laws of some countries and those arising from the Report on Action 4 of the BEPS.

Author: Roberto Scalia, Chairman Tax Commission

Article on “GCC VAT – International Services” 

A new article on cross-border aspects of GCC VAT in respect of supplies of services is now available on the IBFD Tax Research Platform, at the following link:

https://www.ibfd.org/IBFD-Products/Journal-Articles/International-VAT-Monitor/collections/ivm/html/ivm_2018_03_int_1.html

The article, co-authored by Howard R. Hull and Roberto Scalia, will be published on the International VAT Monitor, Issue N. 3 of 2018, IBFD Journals.

In this article, Hull and Scalia focus on the international supply of services in the GCC member states, including the place-of-supply rules and the VAT treatment of inbound services into GCC markets, outbound services from GCC markets and intra-GCC services.

In order to address these subjects, the authors rely significantly on the GCC VAT Agreement and explore how the Saudi Arabia and the United Arab Emirates have addressed the VAT treatment of the international supply of services within their legislations, executive regulations and administrative practices.

The Special Newsletter is now on PDF format

For all those who missed the special edition of the JIACC's Tax Commission Newsletter, here is the Newsletter in pdf version, still available. Enjoy the reading!

Special Newsletter in PDF format