People in Tokyo walk past a screen showing a news programme calling for power saving in March last year. Japan’s government had alerted people to potential power cuts after several coal-fired plants temporarily stopped generating electricity following an earthquake. AP
People in Tokyo walk past a screen showing a news programme calling for power saving in March last year. Japan’s government had alerted people to potential power cuts after several coal-fired plants temporarily stopped generating electricity following an earthquake. AP
People in Tokyo walk past a screen showing a news programme calling for power saving in March last year. Japan’s government had alerted people to potential power cuts after several coal-fired plants temporarily stopped generating electricity following an earthquake. AP
People in Tokyo walk past a screen showing a news programme calling for power saving in March last year. Japan’s government had alerted people to potential power cuts after several coal-fired plants t


Earthquakes, disease and climate change are threats we must prepare for


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February 14, 2023

It is perhaps human nature that many people plan for the worst-case scenario only when presented with an acute crisis – a health scare can prompt a lifestyle change; a financial blow or redundancy can push us towards saving and investing responsibly.

But when natural disasters, disease and global warming threaten millions of lives, entire cities or a whole economy, the need to look ahead and plan accordingly gains urgent and critical importance.

There is no shortage of threats to deal with. The horrific earthquake that tore apart southern Turkey and north-west Syria a week ago is a forceful reminder of our vulnerability to a natural phenomenon that the US Geological Survey has said is impossible for scientists to predict.

Less than a fortnight ago, a report from the Red Cross on future pandemics said “all countries remain dangerously unprepared for future outbreaks”.

And on global warming, the World Economic Forum’s Global Risks Report for 2023 released last month said “climate and environmental risks are the core focus of global risks perceptions over the next decade – and are the risks for which we are seen to be the least prepared”.

When faced with these dangers, a failure to prepare – such as by neglecting infrastructure, not developing early warning systems, or letting disease research fall behind – seems an obvious mistake to avoid. But when it comes to actually developing and adopting preparedness strategies, the challenges are many.

A man uses a satellite dish to move children across a flooded area after heavy monsoon rains in Pakistan last August. The country has had to receive more than $8 billion in support from donors. AFP
A man uses a satellite dish to move children across a flooded area after heavy monsoon rains in Pakistan last August. The country has had to receive more than $8 billion in support from donors. AFP

In some countries, governments – whose job it is to ensure their nations are prepared – come and go, and their action plans, time tables and commitments can be rewritten or even jettisoned when an electoral cycle puts a new party in power.

Fortifying buildings, protecting essential infrastructure, training and equipping rescue personnel or investing in research does not come for free, and there will always be complaints, particularly during tough economic times, that such preparation is too costly. This can make it difficult for officials or international agencies to propose essential but expensive strategies.

But what is the cost of failing to prepare? Aside from the irreplaceable loss of human life, earthquakes, eruptions and tsunamis smash roads, factories, hospitals, power plants and communications. Their loss makes normal economic life almost impossible and it can take countries decades to recover fully.

Last September, Pakistan was hit by devastating floods caused by torrential rains that scientists have said were fuelled by climate change. At least 1,700 people died and eight million were displaced. The country, which is not in a position to invest in preparedness, had to receive more than $8 billion in support from donors. Other countries that are vulnerable to such disasters could need much more in the future.

It is governments that command the ability to plan and enact preparations for an uncertain future

Planning ahead can be done and there are examples of extensive preparation to learn from. Japan – a famously earthquake-prone nation – is renowned for its strategic approach. Engineers there developed buildings with dampers that can absorb an earthquake’s energy or can move independently from the shaking ground below.

The World Bank has noted how Japan’s approach to planning, sharing preparedness knowledge and developing resilience through learning from and adapting to repeated earthquakes can “bear benefits not only in an emergency but in the everyday operations of organisations and countries”.

Other countries have also embraced the need to plan decades ahead. The UAE has many programmes to maintain and improve transport, industry and energy production, to name but a few. It has also adopted the National Food Security Strategy 2051.

Singapore, another economic powerhouse with a diverse expatriate population, has “steadily moved to reduce its vulnerability by building up coping mechanisms” according to the US Centre for Excellence in Disaster Management.

There is much expected of governments, according to Mohammed Al Gergawi, Minister of Cabinet Affairs and chairman of the World Government Summit, which is taking place in the UAE this week.

He told attendees that governments unable to transform or become more agile risked failing their people, adding that technology and artificial intelligence presented states with an incredible opportunity to improve lives.

That opportunity must be taken. Although international organisations and NGOs do sterling work – such as the Red Cross and Red Crescent Societies who already help many countries to identify risks and hazards – it is governments that command the ability to plan and enact preparations for an uncertain future.

None of this is to say that adopting long-term preparedness strategies will prevent death and destruction. Some things are beyond our control. But it is possible to start taking steps – now – to minimise the threats from the many crises facing us, both acute and chronic.

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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

Updated: February 14, 2023, 12:11 PM