Environmental protesters outside the United Nations summit on climate change in Katowice, Polandon December 8, 2018. Getty
Environmental protesters outside the United Nations summit on climate change in Katowice, Polandon December 8, 2018. Getty
Environmental protesters outside the United Nations summit on climate change in Katowice, Polandon December 8, 2018. Getty
Environmental protesters outside the United Nations summit on climate change in Katowice, Polandon December 8, 2018. Getty

Key issues unresolved, UN chief warns climate talks


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"Key political issues" deadlocking UN climate talks "remain unresolved", UN Secretary General Antonio Guterres warned Wednesday after an unscheduled stop at the troubled negotiations in Poland.

The fight against climate change is a "matter of life and death today," he told ministers and delegates at the 195-nation UN forum tasked with beating back the threat of global warming, barely 48 hours before the meet in the coal town of Katowice was set to adjourn.

The two-week talks are tasked with breathing life into the 2015 Paris Agreement, which vows to cap global warming at "well under" 2°C above pre-industrial levels and funnel hundreds of billions of dollars to poor countries already feeling the sting of deadly storms, heatwaves and droughts made worse by climate change.

But efforts to elaborate a "rule book" for the Paris pact and to boost the carbon-cutting pledges of all nations have run aground, even as a barrage of scientific reports have warned that only immediate and radical measures can avert catastrophic climate impacts.

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"The eyes of the world are upon us," said Mr Guterres, who had not planned to return to the talks after addressing the opening plenary 10 days ago.

"To waste this opportunity would compromise our last best chance to stop runaway climate change," he said.

"It would not only be immoral, it would be suicidal."

A major report called for by the UN climate body concluded in October that Earth's rise in temperature must be capped even lower – at 1.5C – to avoid the danger of runaway warming.

But several countries at the talks, led by the United States and Saudi Arabia, have blocked efforts to endorse the report, which many developing countries see as essential.

"The IPCC report on 1.5C is the basis for all future action, on what we need to do," Vanuatu Foreign Minister Ralph Regenvanu told AFP.

Endorsing the report's findings at the conclusion of the UN forum "is a red line issue for us."

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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

Our legal columnist

Name: Yousef Al Bahar

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

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