Insight and opinion from The National’s editorial leadership
October 25, 2021
With less than a week remaining for the global climate summit, or Cop26, to begin in Glasgow on October 31, Saudi Arabia's reveal of its impressive carbon zero goals comes at a crucial time. It also heralds the visit of US climate envoy John Kerry to Riyadh where the green initiative forums are under way. Mr Kerry has this year been to the Middle East multiple times. On a trip to Abu Dhabi in June, in fact, he mentioned that the UAE was a good contender to host Cop28 in the year 2023.
The UAE, having unveiled its own strategic initiative last month to reach net-zero by 2050, has praised Saudi Arabia’s move to reach net-zero carbon emissions by 2060. Dr Sultan Al Jaber, Minister of Industry and Advanced Technology and UAE Special Envoy for Climate Change, lauded Saudi Arabia's decision, calling it a “landmark, bold, long-term” strategic initiative.
There is no doubt that the measures the kingdom announced on Saturday are in step with global climate priorities. For the world’s biggest oil exporter – a country of 34.8 million people – to set a goal of achieving net-zero carbon emissions by 2060 is a prodigious step by any yardstick. The panoramic nature of the kingdom's climate ambitions is evident.
And even while the idea of the year 2060 could appear somewhat far down the road, there are objectives Saudi Arabia intends to meet in the much nearer future – at a halfway mark, so to speak. In another nine years, for example, by the year 2030, wind and solar energy will generate half of the country’s electricity. Also by that time, global methane emissions will be cut by 30 per cent from 2020 levels. The kingdom is also planning an enormous new hydrogen fuel plant in Neom, its futuristic city.
Participants attend the Saudi Green Initiative Forum to discuss efforts by the world's top oil exporter to tackle climate change, in Riyadh, Saudi Arabia, October 23. Reuters
Saudi Arabia’s Vision 2030 programme, an ambitious national reform plan that aims to reduce the kingdom’s dependence on oil revenue, prioritises environmental protection and climate targets. The vision is to diversify energy production.
For a country of Saudi Arabia's scale and influence to move away from fossil fuels to renewables, stressing its intent to invest more in green energy refocuses the climate framework for the entire region. Its net-zero agenda could well inspire other economies in the Gulf – and parts of the world that have yet to flesh out their climate goals – to similarly plan and cut carbon emissions to align with the goals of the Paris Agreement.
Earlier this year, when Saudi Arabia's Crown Prince Mohammed bin Salman announced two projects to reverse environmental degradation and climate change, he said: “As a leading global producer of oil, we are fully aware of our share of the responsibility in advancing the fight against the climate crisis and as our pioneering role in stabilising energy markets during the oil and gas era, we will act to lead the next green era."
For decades, fossil fuels have been the mainstay for multiple Gulf economies – indeed, on which several well-positioned economies have been built. And hardly limited to the Middle East, industry and production across the world have run on oil and gas. Viewed through this lens, for a major oil-producing country to move away from its core output, barrels of which have been shipped to countries everywhere, and have literally fuelled factories and economic growth for decades, is a tremendous change. For carbon zero goals of such scale to be met requires time, consistency and effort.
Saudi Arabia has shown great purpose in stating its long-term green missions. In embarking on a path with environmental concerns as the guiding light, it could spur urgent climate action far across its borders.
The biog
Name: Younis Al Balooshi
Nationality: Emirati
Education: Doctorate degree in forensic medicine at the University of Bonn
Hobbies: Drawing and reading books about graphic design
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
As per the document, there are six filing options, including choosing to report on a realisation basis and transitional rules for pre-tax period gains or losses.
SMEs with revenue below Dh3 million per annum can opt for transitional relief until 2026, treating them as having no taxable income.
Larger entities have specific provisions for asset and liability movements, business restructuring, and handling foreign permanent establishments.
There are numerous success stories of teen businesses that were created in college dorm rooms and other modest circumstances. Below are some of the most recognisable names in the industry:
Facebook: Mark Zuckerberg and his friends started Facebook when he was a 19-year-old Harvard undergraduate.
Dell: When Michael Dell was an undergraduate student at Texas University in 1984, he started upgrading computers for profit. He starting working full-time on his business when he was 19. Eventually, his company became the Dell Computer Corporation and then Dell Inc.
Subway: Fred DeLuca opened the first Subway restaurant when he was 17. In 1965, Mr DeLuca needed extra money for college, so he decided to open his own business. Peter Buck, a family friend, lent him $1,000 and together, they opened Pete’s Super Submarines. A few years later, the company was rebranded and called Subway.
Mashable: In 2005, Pete Cashmore created Mashable in Scotland when he was a teenager. The site was then a technology blog. Over the next few decades, Mr Cashmore has turned Mashable into a global media company.
Oculus VR: Palmer Luckey founded Oculus VR in June 2012, when he was 19. In August that year, Oculus launched its Kickstarter campaign and raised more than $1 million in three days. Facebook bought Oculus for $2 billion two years later.
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
2016 - Lewis Hamilton (Mercedes-GP)
2015 - Lewis Hamilton (Mercedes-GP)
2014 - Lewis Hamilton (Mercedes-GP)
2013 - Nico Rosberg (Mercedes-GP)
2012 - Mark Webber (Red Bull Racing)
2011 - Fernando Alonso (Ferrari)
2010 - Mark Webber (Red Bull Racing)
2009 - Sebastian Vettel (Red Bull Racing)
2008 - Lewis Hamilton (McLaren)
2007 - Kimi Raikkonen (Ferrari)
