(MENAFNEditorial) Dubai, UAE, May 30, 2016: UAE-based multinationals will start to feel the impact of the OECD Base Erosion and Profit Shifting (BEPS) proposals that come into effect this year, a KPMG seminar on international tax developments has revealed.
The BEPS proposals are focused on mitigating tax planning strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations even though a company may have little or no economic activity there, resulting in less corporate tax being paid.
“We expect that 2016 will be a transitional period for the region. The new OECD BEPS proposals mean that a number of regional companies will be subject to an unprecedented level of disclosure and scrutiny. We wanted to offer insight into likely priorities for companies that have regional and international operations, and how they can best prepare for these impending changes,” Nilesh Ashar, an international tax partner with KPMG in the UAE, said.
The BEPS initiatives will significantly affect multinational enterprises with operations in OECD companies, which include the US, the UK, China, Japan and Saudi Arabia.
Shabana Begum, Head of Middle East and South Asia Transfer Pricing for KPMG said: “Transfer pricing is important because it gives organisations with large international operations the opportunity to recognise and manage profits where they operate.
“An increasing number of tax authorities are implementing the BEPS proposals, and they remain committed to continued international co-operation in order to address offshore tax evasion and work towards a fairer and more transparent international tax system. Complying with these new rules should be seen as an opportunity for global companies headquartered in the UAE and across the region to streamline their supply chains with reference to value creation and substance and to mitigate their tax risks.”
The KPMG tax seminar also focused on the UK residential real estate market and highlighted some of the most important factors influencing London’s housing market over the short to medium term.
Mike Walker, a partner with KPMG in the UK, said: “Changing tax regulations in the real estate sector in the UK are creating uncertainty as supply shortages and price rises force investors to consider alternatives, while those determined to remain in the real estate sector are looking to diversify. We wanted to address these issues and provide an update on upcoming changes, while suggesting how these might be navigated.”
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