Taxation And Technology In GCC

How has the implementation of the VAT in UAE and KSA assisted in raising the profiles of these two countries in the global context?

The implementation of VAT came about partly in response to recommendations from the IMF and is really about modernising and diversifying the economies in the UAE and KSA regions. The implementation of VAT elevates these countries on the global stage.

VAT is the fastest growing tax to roll out around the world, starting in a handful of countries in the 1950s and sweeping across the globe to the point where more than 190 countries collect VAT today. It’s about increasing transparency in that the information collected through this process gives governments more insights into organisations.

Are there any international tax updates that this market should be aware of?

Tax is always evolving, so there are endless updates to be aware of, but what I would highlight for this region now is the increasing call for transparency around the world, particularly in two areas. The first is transparency in relation to individuals, particularly through the common reporting standard.

Although we’re not quite there yet in terms of these being globally-accepted, the standard is taking hold across many jurisdictions and I expect we will see even more of this, and eventually global acceptance of the common reporting standard and cross border reporting of information. The other side of that trend is corporate transparency as we see pressure in many regions around the world for multinational organisations to publish more of their tax information, and that will undoubtedly have an impact in this market as well.

What is the future of taxes and how do you see this impacting the region?

The world of tax technology is a big one and it’s growing. On one hand, we have advances in technologies on the tax authority side, which is streamlining reporting processes and making tax collection more efficient. I expect we will continue to see more of that around the world. Within organisations, we increasingly see technology being used to help streamline and improve compliance processes, as well as innovative technologies for data and analytics, robotic process automation and even artificial intelligence used in creative ways within the tax function.

Within KPMG, we’ve invested heavily in these areas. In relation to VAT, for example, we can increasingly automate the processes around this, and apply data and analytics for realising more value from the data already on hand in the organisation. As advances like artificial intelligence and robotics are increasingly applied to tax, we are able to automate and augment a range of highly standardised tax compliance and reporting activities, freeing tax teams from routine compliance tasks to focus on value-adding activities, such as highlevel oversight, process improvement and strategic and reputational analysis activities, for example.

When we look to the future, as a result of the evolving role of the tax professional and the automation of tax collection and reporting, a broader skillset becomes increasingly important. In-house tax professionals may do less routine tax compliance work, but they will face new demands to improve data collection processes across the finance organisation and to work with data and analytic tools to turn financial information into actionable insight. Technology will be a big part of that, and so the future of tax is one in which we see a new type of tax professional with expansive knowledge of technology, tax and accounting, and an enthusiasm for contributing to their organisations’ data quality and decision making.