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The tax landscape in Kuwait is evolving fast and so is the transformation and digitization of the tax authority, according to experts professional services firm EY at recently concluded series of tax webcasts.
The virtual sessions, which were attended by more than 200 tax and accounting professionals from entities across Kuwait, discussed updated recent practices and digitalization of processes by the Kuwait Tax Authority, potential challenges that tax-payers in the country could face, and the future of finance and tax functions in the region.
Ahmed Eldessouky, Kuwait Tax Leader, EY, said: “The COVID-19 pandemic forced regional governments to concentrate on stimulating business, supporting individuals, as well as using tax and expenditure to support companies. In 2020, the Kuwait Tax Authority was amongst the first in the region to postpone submission of tax returns and the payments deadlines to support the private sector and the wider economy.”
“Today, tax authorities have renewed focus on tax audits and transfer pricing. The landscape is also being completely transformed by digitization, and tax administration processes are already far more digital than initially expected.”
A topic of focus was the recent tax updates in Kuwait and the digitization and transformation of the Kuwait Tax Authority. EY speakers commended the steps taken by the Kuwait Tax Authority, amongst the tax authorities in the region, in supporting capital markets and promoting the private sector throughout the COVID-19 pandemic.
Further discussions around VAT, base erosion and profit shifting (BEPS), transfer pricing and economic substance developments looked into their collective impact on Kuwait and the MENA region.
With Kuwait having ratified the VAT Framework Agreement of the GCC and remaining committed to implement VAT soon, EY tax experts recommended that businesses in Kuwait should immediately start preparing for correct VAT setup and compliance, given that most companies typically need at least six to eight months to be ready.
EY speakers also discussed the future of tax and finance in Kuwait and the region and the role played by technology in the tax and finance functions as well as the increasing need of embracing technology.
Nitesh Jain, EY Kuwait Tax Partner, said: “There is a growing need to synchronize tax within the wider finance function due to updates in the tax laws locally, regionally and globally. The increased focus on the transparency of data by tax authorities, requires enterprises (Kuwaiti and non-Kuwaiti) to develop a strong link and cohesion between tax and finance functions for daily operations and to be compliant with the fast-paced changes.”
Guest speakers and other subject matter experts also discussed the growing need to digitize accounting, payroll and finance operations. Other key topics discussed during the webcasts were the future of legal services and key updates on automatic exchange of information (AEOI),Foreign Account Tax Compliance Act (FATCA)and the Common Reporting Standard (CRS). – TradeArabia News Service
EY holds form on Kuwait tax landscape
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