Firms updating to comply with VAT requirements

As the country is in the process of introducing VAT (Value Added Tax) along with the rest of the GCC that can generate an annual contribution of RO 400 million to the Sultanate’s GDP, companies and their finance departments are currently updating their systems that fully comply with VAT requirements.

These companies, ranging from large, mid-size to small organisations, have already installed measures in place to ensure that starting 2018 they have an updated VAT provision for all the products and services that they deal with.

Majlis al Shura’s economic committee has decided to join hands with the rest of the GCC countries in introducing VAT by the middle of next year or may be earlier and it mulled over a mechanism on how to collect the VAT.

“We are listening to the authorities on how to go about the VAT and are currently in touch with economic and IT experts to update our systems that fully comply with VAT requirements”, Chief Financial Manager of a leading company in Oman said.

VAT, which will be incrementally deployed across Gulf countries in the short future, is said to be a measure to face the ongoing oil price crisis.

Experts say that activating VAT function or replacing the old systems of the big, small and medium companies will be the buzzword in the days to come.

“Scenarios such as updating existing systems by activating the VAT function of ERPs or simply taking the opportunity to replace old systems with next gen apps as we saw in Europe in the 2000s will be heavily prevalent”, said Arun Khehar, SVP Applications ECEMEA, Oracle in an e-mail.

“However, we will also witness the emergence of a third scenario which is cloud VAT services which will allow quicker deployments while ensuring the company is always compliant with any legal change”, he added.

According to him, there will be 3 emerging trends in finance across Europe, Middle East and Africa (EMEA) region which are Cloud’s leading position in mass ERP adoption, VAT and the Intelligence in the context of business decisions.

“The next massive wave of adoption will be ERP in the cloud as finance and supply chain lines of business start to not only see the immediate value of the cloud because it is such as faster innovation. Cloud offers a secure business environment and the simplicity of the cloud can help organisations to easily digitise and improve core business processes and operations.

“In addition, as we move to a postoil economy, deploying the latest cloud innovations can accelerate development of new business models, processes and decisions. The more I think about it, the more I believe that cloud is the perfect fit for a fast-changing world. It is the only consumption model that offers such a level of flexibility combined with quick innovation cycles”, he added.

He further said that Artificial Intelligence will be at the forefront of developing and managing enterprise applications in the near future.