• Iranian President Masoud Pezeshkian has pledged to crack down on bribery and rent-seeking, while urging unity and restraint after days of protests over economic hardship that have left at least three people dead. The deaths mark an escalation in the unrest that has ‌spread across the country since shopkeepers began protests in the capital Tehran on Sunday over inflation and the falling currency.
  • UAE President Sheikh Mohamed and Sheikh Tamim, Emir of Qatar, discussed efforts to bolster co-operation between the Gulf neighbours during a phone call. They reflected on the fraternal relations between the countries and exchanged views on the latest developments in the region.
  • International medical charity Doctors Without Borders (MSF) has urged Israel to allow it to continue operating in Gaza, after it announced a ban on more than 37 NGOs from working in the strip under draconian new registration rules. Senior European politicians have warned that Israel's move is “unacceptable”.
  • US President Donald Trump's Envoy for Iraq, Mark Savaya, listed militia groups, uncontrolled weapons and foreign interference among things Washington planned to end in the country this year. In a New Year message to the Iraqi people, Mr Savaya said the US was “working to make 2026 the year that marks the end of” 18 items.
  • There was confusion on Thursday over whether flights at Yemen’s Aden international airport had been halted, after reports of a suspension that sparked uncertainty among passengers crowded in the terminal, Reuters reported. Conflicting accounts emerged over what had happened, with different sides trading blame.
  • Israeli forces fired on civilians near the town of Al Rafeed in the countryside of Quneitra in southern Syria, killing several sheep, Syrian state media reported.
  • Iran has warned that US President Donald Trump's threat of further strikes on its nuclear facilities affects the credibility of the International Atomic Energy Agency. Iran's mission to the UN said that “in light of the recent US threat against Iran's peaceful nuclear programme”, it had sent a letter to IAEA chief Rafael Grossi that “warned of severe consequences for the global non-proliferation regime”.
  • Oman has approved its national budget for 2026 and launched the next phase of its economic programme that aims for 4 per cent growth through 2030, ‍as the sultanate continues to diversify from its reliance on oil.

More goings-on

  • The Syrian Interior Ministry announced that it had thwarted an ISIS plot to carry out suicide attacks targeting New Year celebrations and churches, particularly in Aleppo.
  • Syria's Ministry of Economy and Industry announced new measures to support the roll-out of the national currency and maintain market stability, including requiring all businesses to clearly display prices in both the old and new currencies during the transition period.

This newsletter was compiled by Mohamad Ali Harisi, Foreign Editor.

The National produces a variety of newsletters across an array of subjects. To get the best of our coverage straight to your inbox, sign up to them here.

Killing of Qassem Suleimani
While you're here
Longreads
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

The biog

Name: Abeer Al Shahi

Emirate: Sharjah – Khor Fakkan

Education: Master’s degree in special education, preparing for a PhD in philosophy.

Favourite activities: Bungee jumping

Favourite quote: “My people and I will not settle for anything less than first place” – Sheikh Mohammed bin Rashid.

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