Iran's President Pezeshkian meets Saudi Foreign Minister Prince Faisal amid fears of regional escalation

Iranian President Masoud Pezeshkian met Saudi Arabia’s Foreign Minister Prince Faisal bin Farhan in Doha amid mounting fears of regional escalation following Iran's massive missile attack on Israel.

The two leaders discussed the latest regional and international developments in their meeting late on Wednesday in Qatar's capital, the official Saudi Press Agency said, without giving details.

Saudi Arabia and Iran, among the region's powerhouses, restored diplomatic ties in March last year, ending a seven-year rift. Their rapprochement has opened the door to top-level contact but caution remains a defining characteristic of their relations.

The meeting in Doha came a day after Iran launched 180 ballistic missiles on Israel to avenge the killing on Friday of Hassan Nasrallah, leader of Hezbollah – Iran's main regional proxy – and Hamas leader Ismail Haniyeh earlier this year.

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Israel and its main backer the US have vowed to hit back hard to avenge Tuesday's attack, but Iran said on Wednesday its missile volley – its biggest assault on Israel – was over, barring further provocation.

Sources briefed on diplomatic efforts to defuse tension in the region said Saudi Arabia was searching for ways to prevent a major escalation in the Middle East that could spiral out of control.

Tension in the Middle East and fears of a wider conflict have escalated since the war between Hamas and Israel began nearly a year ago. Iran's proxies in the region, including Yemen's Houthis and armed Shiite groups in Iraq – have attacked Israel in efforts to stop its bombardment of Gaza that has killed about 41,700 people.

Hezbollah's daily exchange of cross-border fire with Israel has inched closer to a full-fledged war over the past fortnight, with Israel carrying out a ground invasion in Lebanon this week, and significantly stepping up air strikes, mostly in southern Lebanon, the group's stronghold, and the eastern Bekaa Valley.

Iran's President Masoud Pezeshkian, left, meets Sheikh Tamim, Emir of Qatar, at Lusail Palace in Doha. AFP

Qatar's Emir Sheikh Tamim said on Wednesday that Doha will continue mediation efforts to end the war in Gaza. In a joint press conference with the Iranian President, he said: “The recent surge of conflict in Lebanon is what we have been warning against since the beginning of Israeli aggression.” Israel, he added, must “cease its unjust war in Gaza, and the West Bank and its aggression on Lebanon”.

Mr Pezeshkian warned at the news conference that if Israel acts against Iran, then Tehran will respond in a more severe way. “We are not in pursuit of war with Israel,” he said. “They promised us peace. But Israel has terrorised our guests in Tehran during our presidential inauguration. We want to establish peace. If you disagree, peace will not be established.”

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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The specs

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Transmission: 6-speed auto

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UAE currency: the story behind the money in your pockets

WOMAN AND CHILD

Director: Saeed Roustaee

Starring: Parinaz Izadyar, Payman Maadi

Rating: 4/5

The stats

Ship name: MSC Bellissima

Ship class: Meraviglia Class

Delivery date: February 27, 2019

Gross tonnage: 171,598 GT

Passenger capacity: 5,686

Crew members: 1,536

Number of cabins: 2,217

Length: 315.3 metres

Maximum speed: 22.7 knots (42kph)

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Developer: Big Ape Productions
Publisher: LucasArts
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Rating: 4/5