From left, Australian Prime Minister Anthony Albanese, US President Joe Biden and UK Prime Minister Rishi Sunak at a naval base in San Diego, California, on Monday. AP
From left, Australian Prime Minister Anthony Albanese, US President Joe Biden and UK Prime Minister Rishi Sunak at a naval base in San Diego, California, on Monday. AP
From left, Australian Prime Minister Anthony Albanese, US President Joe Biden and UK Prime Minister Rishi Sunak at a naval base in San Diego, California, on Monday. AP
From left, Australian Prime Minister Anthony Albanese, US President Joe Biden and UK Prime Minister Rishi Sunak at a naval base in San Diego, California, on Monday. AP

Aukus deal: US, UK and Australia unveil nuclear submarine project


Ellie Sennett
  • English
  • Arabic

The leaders of the US, the UK and Australia have announced that Canberra will acquire conventionally armed, nuclear-powered submarines.

US President Joe Biden, Australian Prime Minister Anthony Albanese and British Prime Minister Rishi Sunak gathered at a naval centre in San Diego, California, on Monday to hammer out the Aukus security partnership, which was first announced in September 2021.

China and Russia's reaction to the announcement was hostile after the architects of the deal said it was intended to deepen defence ties, at a time when Beijing is expanding its influence across the Indo-Pacific region.

“The latest joint statement from the US, UK and Australia demonstrates that the three countries, for the sake of their own geopolitical interests, completely disregard the concerns of the international communities and are walking further and further down the path of error and danger,” China's Foreign Ministry spokesman Wang Wenbin said on Tuesday.

Meanwhile, the Kremlin said the plan to create a fleet of nuclear-powered submarines raised questions about non-proliferation.

Mr Biden, Mr Albanese and Mr Sunak on Monday said the agreement renewed a centuries-old alliance to sustain peace, stability and prosperity around the world.

Defence officials from the three countries and US congressional representatives celebrated in the audience.

“This is a genuine trilateral undertaking. All three nations stand ready to contribute and all three nations stand ready to benefit,” Mr Albanese said.

“I look out from here today and I see new frontiers … through Aukus, we turn ourselves to face the future.”

Aukus is a trilateral security pact between Australia, the UK and the US. Reuters
Aukus is a trilateral security pact between Australia, the UK and the US. Reuters

He said the new submarines would be “Australian sovereign”, “built by Australians, commanded by the Royal Australian Navy and sustained by Australian workers in Australian shipyards”.

Mr Biden said: “The hard work of enhancing deterrence and promoting stability is going to affect the prospects of peace for decades to come.”

He repeated that the submarines would be nuclear-powered but not nuclear-armed.

“This first project is only the beginning … the United States could not ask for two better friends or partners,” Mr Biden said.

Mr Sunak said the submarines would be “truly interoperable” as the Royal Navy would operate the same submarines as the Royal Australian Navy, sharing parts with the US Navy.

“We will raise our standards of nuclear non-proliferation,” he said. “This is a powerful partnership. For the first time ever, it will mean three fleets of submarines working together across both the Atlantic and Pacific.”

The White House said the alliance had “identified the optimal pathway” to provide Australia with conventionally armed, nuclear-powered submarines, which included the acquisition of a fleet of British-built vessels that incorporate US technology.

Nuclear-powered submarines would give Australia's navy far greater force and strategic strength as they can remain at sea for months.

Chinese warnings that Aukus could set off an arms race were rejected by a senior White House official who said “the fundamental purpose” of the pact was to “enhance deterrence and support security and stability in the Indo-Pacific”.

“We believe that [the Indo-Pacific] is increasingly being challenged [and] under threat, not only by developments in China but other countries like North Korea and Russia,” another official said.

The US had previously shared its submarine technology only with Britain, in the late 1950s.

While the submarines will be nuclear-powered, Australia has made it clear it does not intend to try to obtain nuclear weapons.

Charles Edel, the chairman of the Centre for Strategic and International Studies in Washington, said that the US, through Aukus, was strengthening two of its closest allies and seeking to convince China “that it is no longer operating in a permissive security environment”.

“Each nation has a slightly different rationale for Aukus but it largely boils down to China,” he said at an event hosted by the centre.

China “was not mentioned when Aukus was first announced, although the exponential growth of Beijing's military power and its more aggressive views over the past decade were the clear animating force behind it”, Mr Edel said.

Aukus infuriated Paris, as it caused Australia to abruptly scrap a $66 billion deal to buy conventional French submarines.

Mr Biden pitched a major boost in submarine production in a budget proposal last week.

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

UAE tour of Zimbabwe

All matches in Bulawayo
Friday, Sept 26 – UAE won by 36 runs
Sunday, Sept 28 – Second ODI
Tuesday, Sept 30 – Third ODI
Thursday, Oct 2 – Fourth ODI
Sunday, Oct 5 – First T20I
Monday, Oct 6 – Second T20I

Company profile

Name: Infinite8

Based: Dubai

Launch year: 2017

Number of employees: 90

Sector: Online gaming industry

Funding: $1.2m from a UAE angel investor

Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
  • Disruption Lab and Research Centre for developing entrepreneurial skills
Updated: March 14, 2023, 11:20 AM