Welcome to the April edition of our tax newsletter, bringing you news on global and regional tax developments. 

International updates

KPMG report: Comments on implementation framework of global minimum tax

The Organization for Economic Cooperation and Development (OECD) on 14 March 2022 published commentary on the Pillar Two model rules which were released 20 December 2021 and provide a precise template for governments to move forward with Pillar Two of the two-pillar solution to address the tax challenges arising from digitalisation and globalisation of the economy. Simultaneously, OECD issued a release seeking comments on the implementation framework of the global minimum tax.

In response to the OECD request for comments, KPMG tax professionals submitted a memo with comments on the implementation framework of the global minimum tax.

See the full text of the report here

GCC updates

The United Arab Emirates (UAE)

FTA user guide (UAEGWB001) on Raqeeb: whistle blower program for tax violations and evasion

The UAE’s Cabinet of Ministers recently introduced the mechanism of “whistleblowing” or Raqeeb, requiring the Federal Tax Authority (“FTA”) to receive and process leads relating to the non-compliance of natural or legal persons with the tax legislation, as well as to offer a monetary reward to informants when certain conditions are met. The aim is to encourage reporting non-compliant business activities in line with the FTA’s mandate to ensure compliance with applicable tax legislation, leading to a prosperous business environment with fair and equal opportunities.

On 14th April 2022, the FTA enabled the “Whistleblowing Form” on its website and issued User Guide [USEGWB001] on Raqeeb: Whistle Blower Program for Tax Violations and Evasion (“Raqeeb User Guide”, “the Guide”). 

Raqeeb User Guide defines the concept of “informant” and “lead” and includes detailed process descriptions on how to submit an eligible lead for the FTA’s review. Once the whistleblowing form is submitted to the FTA, the informant will be notified through an email and will be provided with a reference number. In the meanwhile, the FTA will begin its investigation of the lead. The FTA may at any time reach out to the informant to request further information or details.

The Guide also includes commentary on confidentiality and assures that the identity of the informant remains confidential and protected by the FTA.

Read the full Tax Flash here

Bahrain

Economic substance return deadlines extended for certain entities  

Ministry of Industry, Commerce and Tourism (MoICT) extended Economic Substance (ES) return deadlines for entities who did not have their Financial Statements FY2021 audited by 31 March 2022. Such entities should submit their ES returns by mid-August 2022. It is expected that entities who have submitted their ES returns based on unaudited financial statements may be required to resubmit their ES return based on their audited financial statements.

Obligatory short survey on the National Bureau for Revenue (NBR) portal

Taxpayers logging in to the NBR portal are now required to complete a short Digital Study Survey regarding invoicing. The survey includes questions related to average volume of invoices issued on an annual basis and whether the invoices are issued in an electronic format.

Read the tax newsletter prepared by the KPMG member firm in Bahrain.