Kuwait's Prime Minister Sheikh Sabah Al Khalid attends a special parliament session at the National Assembly headquarters in Kuwait City on February 16, 2021. AFP
Kuwait's Prime Minister Sheikh Sabah Al Khalid attends a special parliament session at the National Assembly headquarters in Kuwait City on February 16, 2021. AFP
Kuwait's Prime Minister Sheikh Sabah Al Khalid attends a special parliament session at the National Assembly headquarters in Kuwait City on February 16, 2021. AFP
Kuwait's Prime Minister Sheikh Sabah Al Khalid attends a special parliament session at the National Assembly headquarters in Kuwait City on February 16, 2021. AFP

Kuwait's government sworn in amid stand-off with ministers


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Kuwait's Prime Minister Sheikh Sabah Al Khalid and the country's council of ministers took the oath of office on Tuesday, amid ongoing tension between the leader and elected assembly.

Dozens of politicians gathered outside the National Assembly in a sign of the lingering discord that peaked in December culminating in the resignation of the Cabinet.

This came after a majority of MPs backed a motion to question the prime minister on various issues, including his choice of ministers.

Parliament's first session after a month-long suspension ordered by the Emir, Sheikh Nawaf Al Ahmad, is also due to discuss an amnesty bill pardoning people charged with storming the parliament in 2011.

The MPs who were protesting outside the assembly agreed to enter the session after the government completed taking the oath.

National Assembly speaker Marzouq Al Ghanim announced in the house that opposition MP Badr Al Dhahoum had been sacked.

His membership of the assembly was nullified by the country's constitutional court on March 14, adding to the simmering tension with elected officials, after he was charged with "insulting the Emir".

Mr Al Dhahoum, who was among the protesters, was one of two members of parliament who this month filed a new request to question the prime minister.

The court revoked Mr Al Dhahoum's membership in line with a law introduced in 2016 that bars anyone convicted of insulting the Emir from taking part in parliamentary elections.

The stand-off in parliament is the new Emir's first big political challenge as the country moves to shore up its finances.

On Monday, he voiced hope that the session "sees fruitful cooperation ... far away from any tension".

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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Favourite superhero: Batman

Favourite quote: We must become the change we want to see, by Mahatma Gandhi.

Favourite car: Lamborghini

Company profile

Name: Dukkantek 

Started: January 2021 

Founders: Sanad Yaghi, Ali Al Sayegh and Shadi Joulani 

Based: UAE 

Number of employees: 140 

Sector: B2B Vertical SaaS(software as a service) 

Investment: $5.2 million 

Funding stage: Seed round 

Investors: Global Founders Capital, Colle Capital Partners, Wamda Capital, Plug and Play, Comma Capital, Nowais Capital, Annex Investments and AMK Investment Office  

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Italy
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Spain
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