BEIRUT // Saad Hariri, the Lebanese prime minister-designate, ended five months of often bitter negotiations with his political rivals yesterday and announced the formation of a national unity cabinet to lead Lebanon's fractious political and sectarian factions.
Despite winning a solid parliamentary majority in June's elections, Mr Hariri and his "March 14" alliance of Sunnis, Druze and some Christian parties had to make a major concession to their Christian rivals in the opposition by allowing Michel Aoun's Free Patriotic Movement (FPM) to retain control of the telecommunications ministry, which Mr Hariri coveted, in order to get the deal.
Yesterday was filled with last-minute negotiations within the March 14 camp, as Christians aligned with Mr Hariri and very much opposed to Mr Aoun reacted to the telecommunications concession with outrage and demands for additional seats on the cabinet.
Late yesterday afternoon, envoys from the March 14 movement convinced the MP Boutros Harb to join the cabinet regardless of his portfolio, allowing Mr Hariri to deliver a letter detailing the cabinet to the president Michel Suleiman.
Mr Harb had wanted control over the justice ministry but eventually dropped his demand because a close ally will control the seat.
The next step before actually taking the reins of government for Mr Hariri - who ascended to the top of Lebanese politics after his father, a former prime minister himself, was killed in a large car bomb in central Beirut in 2005 - will be to draft a ministerial statement. Some observers have expressed concern that the statement might be difficult to agree on by Lebanon's greatly divided majority and opposition, particularly over the right of Hizbollah to continue to maintain an independent military force to fight Israel.
But a one-time close ally of Mr Hariri, who recently defected for a neutral position, said that he doubted the statement would be as hard to draft as it was to select cabinet ministers.
"Let's take things one step at a time. Let's first get over with the government formation and then we talk about the policy statement," the MP Walid Jumblatt told As Safir newspaper.
"Anyway, I don't think there would be a crisis over it [the policy statement]," the Druze leader said. Mr Suleiman was expected last night to issue three decrees: the resignation of the caretaker prime minister, Fuad Siniora, the establishment of the cabinet with the named ministers, and Mr Hariri's promotion from the designated prime minister to the job.
The breakthrough in the talks with Mr Aoun came after Syria and Saudi Arabia pressured with allies in the opposition and majority to end the dispute over whether Mr Aoun's son-in law, Jibran Bassil, would continue to run the telecommunications ministry. Mr Hariri made an offer that was eventually accepted after much public hand-wringing by Mr Aoun, to allow the FPM to keep the seat if Mr Bassil joined another ministry.
Mr Aoun also faced late pressure from his Shiite allies, in particular the speaker Nabih Berri, who had grown impatient with his negotiating stances after the delays entered the fourth month.
The cabinet will be formed around a compromise ratio demanded by Hizbollah, which leads the opposition alliance, to give the minority a one-seat margin to overrule major cabinet decisions. The militant Shiite group has refused to participate in a cabinet that would have the authority to order the group to disarm.
Under the new cabinet, the majority led by Mr Hariri would control 15 seats, while the Hizbollah-led opposition will control 10.
Allies of Mr Suleiman will hold five seats, including returning incumbents loyal to the president to the critical security ministries of interior and defence.
Although Hizbollah's weapons, sectarian tensions between most of Lebanon's 18 official confessionals and the prospect of a possible war with Israel looming are all critical issues for Mr Hariri, perhaps the toughest challenge of the new government will be to manage Lebanon's US$50 billion (Dh184bn) national debt, which is the highest per capita in the world.
mprothero@thenational.ae
MEYDAN RESULTS
6.30pm Baniyas (PA) Group 2 Dh125,000 (Dirt) 1,400m
Winner ES Ajeeb, Sam Hitchcock (jockey), Ibrahim Aseel (trainer).
7.05pm Maiden (TB) Dh165,000 (D) 1,200m
Winner Galaxy Road, Antonio Fresu, Musabah Al Muhairi.
7.40pm Maiden (TB) Dh165,000 (D) 1,400m
Winner Al Modayar, Fernando Jara, Ali Rashid Al Raihe.
8.15pm Handicap (TB) Dh170,000 (D) 1,900m
Winner Gundogdu, Xavier Ziani, Salem bin Ghadayer.
8.50pm Rated Conditions (TB) Dh240,000 (D) 1,600m
Winner George Villiers, Tadhg O’Shea, Satish Seemar.
9.25pm Handicap (TB) Dh175,000 (D)1,200m
Winner Lady Parma, Connor Beasley, Satish Seemar
10pm Handicap (TB) Dh165,000 (D) 1,400m
Winner Zaajer, Fernando Jara, Ali Rashid Al Raihe
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
What is safeguarding?
“Safeguarding, not just in sport, but in all walks of life, is making sure that policies are put in place that make sure your child is safe; when they attend a football club, a tennis club, that there are welfare officers at clubs who are qualified to a standard to make sure your child is safe in that environment,” Derek Bell explains.
Race card
1.30pm: Handicap (PA) Dh 50,000 (Dirt) 1,400m
2pm: Handicap (TB) Dh 84,000 (D) 1,400m
2.30pm: Maiden (TB) Dh 60,000 (D) 1,200m
3pm: Conditions (TB) Dh 100,000 (D) 1.950m
3.30pm: Handicap (TB) Dh 76,000 (D) 1,800m
4pm: Maiden (TB) Dh 60,000 (D) 1,600m
4.30pm: Handicap (TB) Dh 68,000 (D) 1,000m
Sukuk explained
Sukuk are Sharia-compliant financial certificates issued by governments, corporates and other entities. While as an asset class they resemble conventional bonds, there are some significant differences. As interest is prohibited under Sharia, sukuk must contain an underlying transaction, for example a leaseback agreement, and the income that is paid to investors is generated by the underlying asset. Investors must also be prepared to share in both the profits and losses of an enterprise. Nevertheless, sukuk are similar to conventional bonds in that they provide regular payments, and are considered less risky than equities. Most investors would not buy sukuk directly due to high minimum subscriptions, but invest via funds.
ZAYED SUSTAINABILITY PRIZE
How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.