Fighters loyal to Yemen's Houthi rebels stand guard in Sanaa on March 26. AFP
Fighters loyal to Yemen's Houthi rebels stand guard in Sanaa on March 26. AFP
Fighters loyal to Yemen's Houthi rebels stand guard in Sanaa on March 26. AFP
Fighters loyal to Yemen's Houthi rebels stand guard in Sanaa on March 26. AFP


Houthis must prove that they are partners for peace


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April 14, 2023

The Middle East has witnessed a remarkable acceleration in diplomatic rapprochement in recent weeks. As politicians and diplomats widen channels of communication and take careful steps to develop ties, they establish trust and work constructively with former antagonists.

In the case of Yemen – in its eighth year of war since the Houthi rebel group took over Sanaa in 2014 – recent moves towards establishing a long-term truce and possibly finding a political resolution to the conflict are welcome. But the issue of trust is particularly important when governments and the international community have to engage politically with a large, well-armed militia.

Analysts say that Saudi Arabia's talks with Iran over the past months lent momentum to political peace in Yemen and made reaching a deal with the rebels more likely, especially given that negotiations about a planned prisoner swap had been stalled for at least three years. Images this week of the Saudi ambassador to Yemen visiting Sanaa to meet Houthi figures alongside a delegation from Oman show that initial trust, of a kind, may have been established.

Houthi political leader Mahdi Al Mashat, left, welcomes the Saudi ambassador to Yemen, Mohammed Al Jaber and a delegation in Sanaa. AFP
Houthi political leader Mahdi Al Mashat, left, welcomes the Saudi ambassador to Yemen, Mohammed Al Jaber and a delegation in Sanaa. AFP

Nevertheless, there is a long road ahead and efforts to end long-running conflicts are often precarious. Although UN Special Envoy to Yemen Hans Grundberg on Monday called the Saudi-Houthi talks, “the closest Yemen has been to real progress towards lasting peace”, questions remain about the rebels’ intentions.

There is the issue of remaining detainees in Houthi-run jails and the nature of the justice system in areas controlled by the rebels. There are also concerns about the movement’s hostility to members of Yemen’s religious minorities, such as Jews and Bahais. And the rebels will have to facilitate the work of international aid organisations who want to help the country’s millions of impoverished civilians.

It is unrealistic to expect a militant organisation like the Houthis, steeped as it is in extremist ideology, to change overnight. Like comparable movements, such as Hezbollah, it has consistently revealed its propensity for destabilisation while failing when it comes to governing. The Houthis have embedded their loyalists in Yemen’s political institutions and the organisation remains a potent source of regional instability, one that has a track record of attacking neighbouring countries.

So, caution will be needed. Nevertheless, the scenes of recent dialogue in Sanaa and the guarded optimism shown by international negotiators would have been unimaginable even a year ago given the protracted nature of Yemen’s war, which the UN estimates has claimed more than 377,000 lives and created one of the world’s worst humanitarian disasters.

If a tentative peace process is established it could pave the way for the most important element in ending the conflict – talks between Yemeni representatives. Last week, an Omani official told The National: “It is not about the peace mediators; it is about the Yemenis themselves opening up brotherly negotiations to end the civil war.”

For that to happen, trust will need to be built. Yemen’s government, regional neighbours and the international community are ready to do their bit. Now, it is up to the Houthis to prove that they are partners for peace.

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The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE. 

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Launched: 2008

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Prize: Dh2.2 million (Dh360,000 for global high schools category)

Winners’ announcement: Monday, January 13

 

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335 million people positively impacted by projects

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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

Updated: April 14, 2023, 3:00 AM