On Monday, Saudi Arabia announced a plan it hopes will bring to an end Yemen's civil war, as well as the Saudi-led military coalition's involvement in it. The plan prioritises a ceasefire, as well as measures to bring desperately-needed aid into the country immediately.
In a conflict long plagued by diplomatic disappointment, this initiative will seem ambitious. But momentum is strong, particularly as a result of determination among the Saudi-led coalition, GCC countries, the Biden administration and the UN. This confluence of determination dares the Houthis to participate in a re-invigorated peace process, and shows the country's population that the world has not given up on them. As the conflict enters its seventh year, Yemen cannot afford for the world to lose interest.
Clearly defining an enduring framework for Yemen's stability will sustain any potential peace into the future, providing an incentive to stay politically engaged for even the most belligerent parties. The Saudi deal puts on the table the many benefits all sides stand to win if they enter the process with good faith. These include a constructive political process between the internationally-recognised Hadi government and the Houthis, and the more practical necessities of re-opening both Houthi-controlled Sanaa International Airport and the port of Hodeidah, vital entry points for much needed-food and fuel imports.
The Houthis have recently launched a costly assault on Yemen's Marib province. EPA
As the conflict enters its seventh year, Yemen cannot afford for the world to lose interest
The Houthis have, in the first instance, rejected the proposal, describing it as "nothing new". But this round of negotiations is merely beginning. Saudi Arabia has acknowledged ongoing communications with the Houthis via the government of Oman, indicating some commitment from both sides to find a solution.
The Houthis have plenty of reasons to engage. They have sustained heavy losses in a recent campaign in Marib Province, and given their unpopularity in large parts of the country, the group stands to become nothing more than the hostage-takers of Yemen if they continue to reject a political solution.
The list of Houthi atrocities in Yemen runs very long, and the group's extremist ideology and governance model are not a viable roadmap for the country's success. The Houthis will have to concede power, but will also have to be part of the solution. The question becomes how to accommodate that reality, as well as the visions of various other armed groups in the conflict, in a way that ensures the country's sovereign future and empowers all Yemenis.
A federal structure, in which strong local governance counterbalances the power of the central government, is likely to prove the best way forward. It recognises the aspirations of Yemen's firmly ingrained regional identity groups while safeguarding a unified state. It would also diminish the appeal of separatism. But in the end it will be for the Yemenis to decide.
There are no perfect solutions in a conflict as complex and bloody as Yemen's. But there can, and now is, momentum behind the idea that the suffering of the past seven years can end definitively.
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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Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
