An all but empty street in a tourist area of Kuta in Bali, Indonesia, where the government plans to welcome tourists from some countries in October. EPA
An all but empty street in a tourist area of Kuta in Bali, Indonesia, where the government plans to welcome tourists from some countries in October. EPA
An all but empty street in a tourist area of Kuta in Bali, Indonesia, where the government plans to welcome tourists from some countries in October. EPA
An all but empty street in a tourist area of Kuta in Bali, Indonesia, where the government plans to welcome tourists from some countries in October. EPA

Indonesia plans to reopen to tourists from some countries as Covid-19 cases fall


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Indonesia may allow foreign tourists to start returning to the popular resort island of Bali and other parts of the country by October after a sharp fall in Covid-19 case numbers, senior minister Luhut Pandjaitan said on Friday.

The South-East Asian nation intends to move cautiously to reopen its borders after a devastating second virus wave, driven by the Delta variant.

Mr Luhut, Co-ordinating Minister for Maritime and Investment Affairs, said the addition of confirmed cases of Covid-19 had dropped by 94.5 per cent since a peak in mid-July.

"We are happy today that the reproduction rate is below 1 ... it is the lowest during the pandemic and is indicating the pandemic is under control," Mr Luhut said.

Other positive signs included the national hospital bed occupancy rate falling below 15 per cent, while the positivity rate, or the proportion of people tested who are positive, was below 5 per cent, he said.

Mr Luhut said if the trend continued "we are very confident" that Bali could be reopened by October.

South Korea, Japan, Singapore and New Zealand are among the first countries from where the government is considering accepting foreign citizens, given the low virus spread in those nations, he said.

Indonesia's health minister Budi Gunadi Sadikin told Reuters this week that reopening to foreigners also hinged upon 70 per cent of the target population receiving their first Covid-19 shot.

More than 21 per cent of the targeted 208 million have been fully vaccinated, while almost 40 per cent have received their first shot, according to health ministry data.

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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Updated: September 18, 2021, 5:54 AM