Kamala Harris to preside over Senate after Democrats win key Georgia races

Democrats Raphael Warnock and Jon Ossoff defeated Georgia’s two sitting Republican senators on Tuesday, handing Democrats complete control of Congress.

Their wins in the run-off elections also gave president-elect Joe Biden more leeway in confirming his Cabinet nominees and pursuing his legislative agenda.

Their victories also ensure that vice president-elect Kamala Harris will assume an unusually active role on Capitol Hill.

It will fall to Ms Harris to cast any tie-breaking votes in the Senate, which will be split between 50 Democrats and 50 Republicans.

This will be the fourth time in the US history that a vice president has presided over an evenly split Senate.

The Senate was last split 50-50 between the parties in 2001, with former vice president Al Gore ensuring Democratic control for less than a month before Republicans took control when former vice president Dick Cheney assumed office.

Because of Georgia’s election laws, the two Republican incumbents – Kelly Loeffler and David Perdue – had to face off against Mr Warnock and Mr Ossoff as none of the candidates won more than 50 per cent of the vote in the November elections.

While campaigning for Mr Warnock and Mr Ossoff on Monday, Mr Biden vowed that $2,000 stimulus cheques “will go out the door” if they won their races and secured Democratic control of Congress.

While President Donald Trump had also endorsed directly paying Americans the same amount, the economic stimulus package he signed last month contained only $600 cheques because legislators in his party were unwilling to provide the $2,000.

Ms Loeffler and Mr Perdue, who tied themselves closely to Mr Trump, came out in favour of $2,000 stimulus cheques in the final days of the race.

Mr Biden and the Democrats also condemned Mr Trump over a released recording of a call on Saturday in which he pressured Georgia Secretary of State Brad Raffensperger to "find" exactly enough votes to undo his November loss in the state.

Ms Loeffler and Mr Perdue joined Mr Trump’s earlier attacks on Mr Raffensperger, echoing the president’s unsubstantiated claims of voter fraud.

Mr Trump made the same allegations about Tuesday’s run-off election on Twitter several hours before the Democratic victories.

Fair Fight Action, a non-profit organisation founded by politician Stacey Abrams to advocate changes in voter registration, is largely credited with the unusually high level of Democratic turnout and involvement in a special election.

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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