Britain's Prime Minister Rishi Sunak serves guests as he speaks with them during a coronation Big Lunch organised in Downing Street, London. AFP
Britain's Prime Minister Rishi Sunak serves guests as he speaks with them during a coronation Big Lunch organised in Downing Street, London. AFP
Britain's Prime Minister Rishi Sunak serves guests as he speaks with them during a coronation Big Lunch organised in Downing Street, London. AFP
Britain's Prime Minister Rishi Sunak serves guests as he speaks with them during a coronation Big Lunch organised in Downing Street, London. AFP


Sunak's smiles for coronation mask Conservatives' health woes


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May 09, 2023

During the coronation ceremony and celebration concert at Windsor, Rishi Sunak appeared all smiles.

In one sense, he had every right to look happy — these were joyous, uplifting occasions and it was hard not to be moved by either. In another, though, he could allow himself an inward chortle — so dominant was the anointing of King Charles III that it swamped all the domestic media coverage. Without it, surely, more attention would have been devoted to Mr Sunak and his fellow Tories taking a pasting in the local elections.

On one level nationally, picking councillors does not matter. If, as well, you’re the incumbent government as Mr Sunak’s is, tradition virtually dictates you will be beaten, losing more council seats than you win. Then it’s a question of how many? This time, the Conservatives lost more than 1,000 councillors and 48 town halls. That’s bad.

There’s also a supplementary question, which is where? They were defeated all over England: North, South, East and West. They were hammered in rich areas, poor areas, in their historic country shire strongholds and in urban centres, by young and old, voted against by the educated and uneducated. It was as comprehensive a drubbing as we’ve witnessed for a while.

If the whole country had voted this way, the Tories would be on a lowly 26 per cent, Labour on 35 per cent, the biggest lead in two decades. Not that Labour would have swept to power with a thumping majority. More likely, thanks to tactical voting and an unknown hanging over Scotland, depending on whether the SNP can extricate itself from scandal and still convince as a political party with a future, is a hung parliament.

For all his cheery optimism, Sir Keir Starmer does not command the country’s affection, not enough to persuade Tory waverers to vote for him and Labour en masse. Enough of them would rather pick the Liberal Democrats.

Regardless, however. On this showing, Mr Sunak and his party are doomed. They saw the Red Wall in the North turn on them, their old Blue Wall in the South did the same. Brexiteers, remainers, it did not matter — the voters did not support the Tories.

Rishi Sunak leaves the Conservative Party headquarters in central London last week. AP
Rishi Sunak leaves the Conservative Party headquarters in central London last week. AP

Unless his parliamentary colleagues are going to stagger on, demoralised and probably searching for jobs for once the next election is over, Mr Sunak must pick them up, galvanise them, and fast.

For the first time since entering Number 10, he must show he has beliefs, that he is not just there to mind the shop, that he really does know how to make a difference, to improve people’s lives.

So far, the Prime Minister has had a fairly easy time of it. Sure, he’s had crises to deal with — Ukraine, climbing cost of living, rising energy bills, immigrants crossing the Channel, a fragile peace in Northern Ireland, picking up the pieces from his predecessor, and a succession of resignations on the back of bullying and sleaze allegations.

The true test, however, is where he brings added value. It’s about introducing proactive measures, not ones rushed through in response to a critical situation, but those that define the character and hue of the premiership. Sunak has been fortunate in that he has not been required to prove his true mettle, to come up with meaningful initiatives, until now. But now, the local elections debacle dictates, he must.

If Mr Sunak wants to have a fighting chance in the next national ballot and if he wishes to preserve the careers of several of his friends, ministers, not to mention dozens of backbenchers, he must stop shilly-shallying and deliver.

Which is why, no sooner than the last piece of pageantry faded, we are treated to a slew of announcements concerning the NHS. They are designed to alleviate the pressure on GPs, to reduce delays and remove logjams, to make primary health care more accessible for all.

Brexiteers, remainers, it did not matter – the voters did not support the Tories.

It’s no coincidence that the NHS should be first — as the country united to oppose Mr Sunak, so does the state of the NHS unite the nation.

Personal geography and demography do not matter — private polling by the main political parties consistently highlights the overriding importance of the health service. It towers over every other subject, regardless of age, wealth, location, background, job, ethnicity, usual political persuasion. Its hold on the British psyche is bizarre for foreigners to comprehend.

Make improvements there, and Mr Sunak will have registered a genuine achievement, one the Tories can sell hard when the general election comes. It’s also something he can use to head off rumbling criticism within his own party. Boris Johnson remains his greatest internal threat, but Mr Johnson harks back to old battles, to staying in the EU or leaving. The local elections showed those feuds no longer resonate; Mr Sunak is ignoring them and moving on to a new agenda.

He wants to get the economy back on to a growth path. The word has gone out across Whitehall for departments to come up with ideas — but they must not repeat those rushed forward by Liz Truss and her chancellor, Kwasi Kwarteng. This is awkward and perhaps mistaken. There was little wrong with what Truss and Kwarteng were proposing. The problem was that they chose to do it all at once and were not clear as to how their package was to be funded. The markets took fright and that was the end for them.

Rishi Sunak has his blood pressure checked at a GP surgery and pharmacy in England. AFP
Rishi Sunak has his blood pressure checked at a GP surgery and pharmacy in England. AFP

Mr Sunak is set on striking trade deals, ones of greater significance than those secured by Ms Truss, when she was foreign secretary. We can expect those, together with moves on law and order, housing, online abuse and trolling, closer relations with the EU.

He always seems to have a spring in his step. Well, Mr Sunak needs one now. After years in the doldrums, when the pandemic took charge and Britain had a prime minister in Mr Johnson who had won a landslide and felt he had nothing to prove, and consequently believed he could get away with doing very little (just as well, since there was not much that motivated him), politics is all about policies again.

The local elections have told Mr Sunak he has a mountain to climb, but the country isn’t enamoured with Mr Starmer. Meanwhile, the Lib Dems, under Sir Ed Davey, are back. Suddenly, it has got a whole lot more interesting.

Living in...

This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.

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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

Karwaan

Producer: Ronnie Screwvala

Director: Akarsh Khurana

Starring: Irrfan Khan, Dulquer Salmaan, Mithila Palkar

Rating: 4/5

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Updated: May 09, 2023, 1:44 PM