Passengers pass by a display at the Terminal 2 of the Airport in Munich, Germany, last week. EPA
Passengers pass by a display at the Terminal 2 of the Airport in Munich, Germany, last week. EPA
Passengers pass by a display at the Terminal 2 of the Airport in Munich, Germany, last week. EPA
Passengers pass by a display at the Terminal 2 of the Airport in Munich, Germany, last week. EPA

Vaccine passports are a work in progress, but they are essential


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Vaccine passports are a much discussed and longed-for platform for recovery from the coronavirus pandemic. The term itself suggests an opening to international travel and, as leisure and business trips come back, the oppression of lockdown life is hopefully behind us.

In fact, events in Europe are showing that the passes are likely to be far more localised and deep-reaching in daily life than travel documents. The day-to-day, perhaps hour-to-hour, nature of the concept is prompting new soul searching on how desirable or even workable the arrangements might be.

With Germany suffering its fastest growing wave of the crisis so far, Boris Palmer, the mayor of the south-western city of Tubingen, has been hailed for going against the trend of stay-at-home orders. Mr Palmer has set up a system of "day tickets" where the 90,000 residents can make their way to any one of eight testing centres in the city. If the antigen test comes back negative, the resident can go to restaurants, shops and the local theatre, when it opens on April 4.

Not all precautions have been thrown away. Patrons would still have to wear a mask inside venues. And the QR code pass worn on a bracelet is only good for the day of issue.

For testing capacity, it helps that Tubingen has a large university. The 30,000 students in the town are also younger and less vulnerable to Covid-19.

Meanwhile, three Swiss cantons are providing points of light in Europe’s darkness by running extensive testing regimes. Not with the relatively easy to administer – but less reliable – antigen devices but spit and PCR tests. The cantons have set up these mass tests to ensure that schools and factories are fully opened to sustain the economic recovery.

However, extending schemes such as this to cities around the world would be fraught with verification issues. The third wave is only just taking off in many European countries, so it is hard to conceive that a relaxation of stay-at-home orders and curfews will be possible before the summer starts.

Drill down and there are barriers to imposing Covid-19 pass regimes everywhere. Is there a model for the workplace? Or for public transport? The use of the system in sports events and restaurants is not a simple option. Who should be given a "laissez passer"? People who have tested positive to Covid-19 in the recent past. With antibody protections, these people should have less fear of social interaction.

Those who have been vaccinated are the obvious candidates. All the major vaccines are proving more than 70 per cent effective against even the mild form of the disease. Of course, with many countries working their way down the age spectrum in distributing vaccines, the pressures on the younger cohorts to get the vaccine would rise. The young might feel excluded but in terms of risk to life, one 83-year-old vaccinated is worth 50 people in their forties.

What about those who merely test negative within a limited timeframe? This would seem to prioritise calculated risks over absolute vigilance against the spread of the coronavirus.

Medical staff fill in a vaccination pass at the local vaccination centre in Ebersberg near Munich, Germany, last week. AP Photo
Medical staff fill in a vaccination pass at the local vaccination centre in Ebersberg near Munich, Germany, last week. AP Photo
Despite the difficulties presented by critics of vaccine passports, the system is the gateway to open up the big European economies

Credentials based on the three criteria above represent a great step forward. To cry that they are inevitably excluding some people is misguided.

In fact, the implementation of a simple system such as this would be enabling. It would allow businesses to restart. These businesses – be they theatres or restaurants – would be able to show that they could operate within regulated conditions, just as they did before the pandemic.

The scale of the system could quickly grow to the size of a domestic driving licence scheme. It can only be justified because it is necessary in the circumstances thrown up by the pandemic.

The related issue of vaccine passports for international travel is, in fact, far more complicated. This is widely seen as a device to allow people to travel to another destination. But this throws up questions, too. For instance, what if people leave their home country and return having picked up the virus or a variant that is potentially even more dangerous? These people essentially become an imported biohazard. The legal implications of tracking disease across international borders is totally untested. The anguish of separation is likely to take on new forms unless the guidelines are well designed.

Returning to life in the locality is the first step. The pain and loss of not going to school, being isolated from family or friends, not accessing leisure venues or going to sports events, not to mention exclusion from care homes and other settings, are now recognised by almost everybody.

Economists measure the value of "bonding" (within the immediate social sphere, community or group), as well as the rewards for "bridging" (between social networks along class, racial and religious lines). By some measures, the boost to GDP from unimpeded bonding is around 5 per cent while bridging adds another 9 per cent.

Andy Haldane, the Bank of England economist, believes people are desperate to regain their lifestyle, socialising and working roles to fuel a “rip-roaring” recovery.

Despite the difficulties presented by critics of vaccine passports, the system is the gateway to open up the big European economies.

Damien McElroy is the London bureau chief at The National

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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

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