Kuwait's Crown Prince addresses parliament. KUNA
Kuwait's Crown Prince addresses parliament. KUNA
Kuwait's Crown Prince addresses parliament. KUNA
Kuwait's Crown Prince addresses parliament. KUNA

No room for settling scores in new parliament, Kuwait Crown Prince says


Ismaeel Naar
  • English
  • Arabic

Kuwait’s National Assembly is poised to open its inaugural session of parliament where Crown Prince Sheikh Meshal Al Sabah called for unity after more than three years of political turmoil.

Kuwait has formed its fifth government in less than a year under Prime Minister Sheikh Ahmad Nawaf Al Sabah, naming new ministers for the defence and oil portfolios who took the oath of office before parliament convened on Tuesday.

“We went through a period of a lack of co-operation between the legislative and executive branches of government and now there is no room for wasting time, effort and opportunities in conflicts and the settling of scores,” Sheikh Meshal told parliament on Tuesday.

“We trust the National Assembly's keenness to achieve the aspirations of the people. We have a new phase of action, reform and advancing the national achievement process ahead of us. The National Assembly must be cleared of obstacles that hinder its work,” he added.

The last time Sheikh Meshal addressed parliament in 2022, he fought back tears as he recited verses from the Quran calling for unity, before receiving a standing ovation from attendees.

A general election last September delivered a mandate for change, bringing 27 new legislators to the 50-member assembly.

But in March, Kuwait’s Constitutional Court annulled the decree dissolving the previous parliament and reinstated it. A few weeks later, the ruling Al Sabah family dissolved that parliament again, setting up the most recent vote, in which most of the legislators elected in September regained their seats.

Kuwait's Crown Prince Sheikh Meshal Al Sabah with Prime Minister Sheikh Ahmad Nawaf Al Sabah. Photo: Crown Prince Diwan / Kuna
Kuwait's Crown Prince Sheikh Meshal Al Sabah with Prime Minister Sheikh Ahmad Nawaf Al Sabah. Photo: Crown Prince Diwan / Kuna

Kuwait is the only Gulf Arab state to have an elected parliament with powers to hold the government to account through measures such as votes of no confidence against cabinet ministers, including the appointed prime minister.

The political impasse between parliament and the government under Sheikh Ahmad over the past year has centred on a draft bill calling on the government to take over the consumer and personal loans of Kuwaiti citizens, with an estimated value of several billion Kuwaiti dinars.

The government said the move would be too expensive, costing almost $46 billion in public funds, while MPs said it would cost less than $6.5 billion.

“We look forward to democratic practices that will contribute to achieving a renaissance and activating the role of the National Assembly. The National Assembly must use constitutional means wisely and must complete the delayed legislation to achieve the aspirations of the people,” the Crown Prince said.

Kuwait's parliament in session.
Kuwait's parliament in session.

Parliament’s inaugural session on Tuesday also elected veteran MP Ahmed Al Saadoun as speaker, a pivotal political role that will shape its relationship with the current government.

Mr Al Saadoun had been speaker of the last parliament that was annulled by Kuwait’s highest court.

Sheikh Ahmad reflected on the recent months of disagreement and disunity between his government and the National Assembly.

“There is a hope that the two authorities will work together to achieve Kuwait's supreme interests,” he told the chamber on Tuesday.

“We are all aware of the seriousness of the current stage we are going through in the region and the world, which makes us face great responsibilities within an important national stage that requires decisions to protect the homeland and its stability.”

About three quarters of the declared winners of the September election were elected again on June 6, while 10 new candidates, most of them young, managed to beat incumbent MPs.

MP Jenan Boushehri was the only one of 13 female candidates to win a seat.

Just 207 candidates contested the election – the lowest number since 1996.

MP Marzouq Al Hubaini was chosen to address the opening session of the National Assembly as one of its eldest members. He also called for political stability.

“In this sensitive period in Kuwait's history, we aspire to transfer the state to a new stage of legal reference, in order to prevent abuse of power by either of the two authorities, and to distance the country from a state of disagreements just for the sake of disagreements,” Mr Al Hubaini said.

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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SPECS
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Updated: June 20, 2023, 10:21 AM