BDO provides insights and roadmap for VAT readiness

KUWAIT: BDO Al-Nisf & Partners (“BDO”), a leading audit, tax and consulting firm in Kuwait and a member of BDO International, the world’s fifth largest network of accounting firms, conducted an awareness seminar on Value Added Tax (“VAT”) on February 19, 2018 at JW Marriott. The introduction of VAT in the GCC has been a matter of significant public interest across all the GCC states over the last couple of years. VAT has already been implemented in Saudi Arabia and the United Arab Emirates (“UAE”) starting January 1, 2018. The seminar was presented by Brian Conn - BDO Kuwait Indirect Tax Partner and Head of VAT in the GCC, Rami Alhadhrami - Tax Director and Mneesh Bajaj - Senior Manager at BDO Kuwait. The seminar focused on the GCC Framework Agreement, the concepts of VAT, the status of its proposed implementation in Kuwait and highlighted experiences learned from VAT implementation in Saudi Arabia and UAE. BDO mentioned that Kuwait is working towards the introduction of VAT starting January 1, 2019 and the remaining GCC countries - Bahrain, Oman & Qatar, are also very likely to introduce VAT latest by January 1, 2019.

The seminar was attended by over 50 delegates including key officials from the Ministry of Finance, Embassies, and commercial companies. Rami Alhadhrami started the seminar by providing insights into VAT developments in the GCC region, and explained key aspects of the GCC VAT Framework Agreement (“the Agreement”) which has been signed by Kuwait. Rami commented on the delay of the issuance of the final VAT regulations in Saudi Arabia and UAE and how this left very little time for businesses to get ready for VAT. Rami also spoke at length about the VAT laws already enacted in UAE and Saudi Arabia covering exempted and zero rated sectors, compliance requirements, to provide the delegates a flavor of how the Kuwait VAT law may be finally structured and how certain sectors will be impacted by VAT. In line with the Agreement, VAT will be introduced in Kuwait at the rate of 5% on supply of goods and services.