A powerful Iran-backed militia group in Iraq has shrugged off fresh sanctions as “ridiculous” on Saturday, alongside another militia also hit with US-financial restrictions.
Kataib Hezbollah and Kataib Sayyid Al Shuhada were already US-designated terrorist groups and subject to sanctions, but additional figures linked to the groups have been targeted in the wake of a spike in drone and rocket attacks on US bases.
The move was shrugged off by spokesmen for both groups, but could complicate US-Iraqi government relations, since both organisations run brigades in Iraq’s Popular Mobilisation Forces, and official branch of the security forces, while Kataib Hezbollah has expanded into the civilian public sector, owning land and a state-owned construction business.
Kataib Hezbollah is the most notable of the two, having fought a long campaign against US forces in Iraq – possibly killing hundreds of American soldiers – since 2004.
Clashes between US forces and the group only halted briefly, between around 2011 and 2017, firstly because the US had pulled out of Iraq and later, as US advisers returned during the war against ISIS, when both sides refrained from fighting.
But after ISIS was all but defeated in late 2017, Kataib Hezbollah resumed attacks on US troops, and tit-for-tat violence escalated to the point where the US killed the group’s leader, Abu Mahdi Al Muhandis in a drone strike near Baghdad airport in early 2020.
Also killed alongside Muhandis was senior Iranian general Qassem Sulaimani, who ran a force tasked with training and equipping foreign militant allies.
A statement on Telegram by Abu Ali Al Askari, a security official in the group, on Saturday dismissed the sanctions as “ridiculous,” and said the measures would not affect the group's operations.
“Well-studied strikes by the Islamic Resistance in Iraq against enemies, causing losses in their ranks and destroying vehicles or confusing or distracting them, is going according to a strategy to drain the enemy,” the statement said.
The statement referred to a new organisation fighting US forces in Iraq, seen as a cover for Kataib Hezbollah and its many allied militias.
Among those linked to Kataeb Hezbollah targeted on Friday are a member of the group's lead decision-making body, its foreign affairs chief, and a military commander the Treasury said has worked with Iran's Revolutionary Guard Corps (IRGC) to train fighters.
The US State Department also designated militia group Kata'ib Sayyid Al Shuhada and its Secretary General, Abu Ala Al Walai, as Specially Designated Global Terrorists.
In a statement posted on Telegram late on Friday, Walai described the sanctions as “a medal of honour”.
Kataib Sayyid Al Shuhada are thought to have been founded in the 1990s after members of the organisation fought alongside Iran during the Iran-Iraq war. Regrouping after 2003, the group received backing from former Iraqi prime minister Nouri Al Maliki.
The sanctions freeze any US assets of those targeted and generally bar Americans from dealing with them. Those who engage in certain transactions with them also risk being hit with sanctions.
The United States has 900 troops in Syria, and 2,500 more in neighbouring Iraq, on a mission it says aims to advise and assist local forces trying to prevent a resurgence of Islamic State, which in 2014 seized large swathes of both countries but was later defeated.
Militia groups in Iraq have linked the recent attacks on US bases to Washington's support for Israel in its war on Gaza, and say the US should cease backing Israel's assault if it wants the attacks to stop.
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
COMPANY PROFILE
Name: Mamo Year it started: 2019 Founders: Imad Gharazeddine, Asim Janjua Based: Dubai, UAE Number of employees: 28 Sector: Financial services Investment: $9.5m Funding stage: Pre-Series A Investors: Global Ventures, GFC, 4DX Ventures, AlRajhi Partners, Olive Tree Capital, and prominent Silicon Valley investors. The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
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- On sale: 2026
- Price: Not announced yet
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