HE the President of the General Tax Authority (GTA), Ahmed bin Issa al-Mohannadi, confirmed that the authority does not intend to impose a tax on income, and that the value-added tax, which has been widely circulated recently, is still under legislation.
In an interview with Arabic newspaper Al-Sharq published Sunday, the GTA president said that tax is one of the most important tools for diversifying the country's sources of income. In line with the legal principle, Qatar has issued Income Tax Law No 24 of 2018 and Selective Tax Law No 25 of 2018 which are implemented by the authority.
He said since the tax is aimed at diversifying the sources of income, exemptions are considered by the State as a kind of support and development for other economic sectors in order to encourage investments in these.
The GTA president considered taxes an essential part and a major income in all countries, especially developed ones, which achieve sustainable economic growth despite the presence of tax rates higher than that in Qatar.
He stressed the need for the tax rate to be compatible with the sector's profitability and competitiveness, as there are other factors of interest to the investor other than tax, such as business costs, production costs, labour and other costs that affect the profitability of the economic sector.
Al-Mohannadi stressed that GTA always seeks to contribute to the achievement of Qatar National Vision 2030 and to promote diversification of sources of income. The exemptions granted are reviewed and studied periodically, as the exempted sectors may be able in the future to achieve a feasible economic return, allowing the authority to impose or increase taxes according to the performance of each economic sector.
On the authority's contribution to enhancing the investment environment and improving the general economic climate in the country, al-Mohannadi said that tax rates in Qatar are among the lowest in the world in order to encourage the investment environment. The presence of taxes also enhances the State's financial solvency and diversifies its sources of income, which enhances its financial position, and creates a safe and attractive investment environment at the same time.
On the tax culture in the community, the GTA president said that since its establishment in 2018, the authority has gradually increased the educational awareness of the community, as it is a new culture for society in Qatar, and therefore the goal of gradual awareness is to provide an opportunity society to understand the concept of tax in its correct form.
He said that this year a large number of taxpayers have registered with the authority and submitted their tax returns, adding that the plan that was adopted to spread gradual awareness succeeded by all measures.
He noted that the authority is running many advertising campaigns to deliver the message of the most important provisions of the Income Tax Law and the Selective Tax Law.
Regarding value-added tax, al-Mohannadi said Qatar has no reservations about this tax, which emerged through a unified Gulf value-added agreement for the Gulf Co-operation Council, and Qatar is part of that agreement. The matter is still under legislation, he added.
On the fallout from the coronavirus pandemic, he said the authority is following the changes resulting from the Covid-19 crisis, and as a result, a package of facilities is being provided, including postponing the submission of tax returns for more than one period, as well as exemptions from fines and financial penalties, which will mitigate the impact of the pandemic on companies.
The impact varies from one economic sector to another, but it was a difficult year for all economic sectors for all nations, he pointed out. However, the impact has been short-lived, and several sectors have begun to recover, starting from the last quarter of 2020. World Bank estimates indicated an estimated growth rate of 3% for Qatar for 2021.
On the authority's role in preparing and implementing double taxation avoidance agreements between countries and evaluating the economic and investment return from these to the state, he stressed the role of the authority is to prepare and negotiate draft agreements to avoid double taxation and prevent financial evasion.
He said Qatar has concluded 88 agreements to avoid double taxation and prevent financial evasion. Negotiations are currently underway with a number of friendly countries with the aim of signing similar agreements, in line with the State's investment orientation abroad, taking into account the investment interests of several parties in the country such as QatarEnergy, Qatar Investment Authority, Qatar Airways, and others, in order to ensure the provision of economic benefits to commercial activities abroad, he said.
He said since the tax is aimed at diversifying the sources of income, exemptions are considered by the State as a kind of support and development for other economic sectors in order to encourage investments in these.
The GTA president considered taxes an essential part and a major income in all countries, especially developed ones, which achieve sustainable economic growth despite the presence of tax rates higher than that in Qatar.
He stressed the need for the tax rate to be compatible with the sector's profitability and competitiveness, as there are other factors of interest to the investor other than tax, such as business costs, production costs, labour and other costs that affect the profitability of the economic sector.
Al-Mohannadi stressed that GTA always seeks to contribute to the achievement of Qatar National Vision 2030 and to promote diversification of sources of income. The exemptions granted are reviewed and studied periodically, as the exempted sectors may be able in the future to achieve a feasible economic return, allowing the authority to impose or increase taxes according to the performance of each economic sector.
On the authority's contribution to enhancing the investment environment and improving the general economic climate in the country, al-Mohannadi said that tax rates in Qatar are among the lowest in the world in order to encourage the investment environment. The presence of taxes also enhances the State's financial solvency and diversifies its sources of income, which enhances its financial position, and creates a safe and attractive investment environment at the same time.
On the tax culture in the community, the GTA president said that since its establishment in 2018, the authority has gradually increased the educational awareness of the community, as it is a new culture for society in Qatar, and therefore the goal of gradual awareness is to provide an opportunity society to understand the concept of tax in its correct form.
He said that this year a large number of taxpayers have registered with the authority and submitted their tax returns, adding that the plan that was adopted to spread gradual awareness succeeded by all measures.
He noted that the authority is running many advertising campaigns to deliver the message of the most important provisions of the Income Tax Law and the Selective Tax Law.
Regarding value-added tax, al-Mohannadi said Qatar has no reservations about this tax, which emerged through a unified Gulf value-added agreement for the Gulf Co-operation Council, and Qatar is part of that agreement. The matter is still under legislation, he added.
On the fallout from the coronavirus pandemic, he said the authority is following the changes resulting from the Covid-19 crisis, and as a result, a package of facilities is being provided, including postponing the submission of tax returns for more than one period, as well as exemptions from fines and financial penalties, which will mitigate the impact of the pandemic on companies.
The impact varies from one economic sector to another, but it was a difficult year for all economic sectors for all nations, he pointed out. However, the impact has been short-lived, and several sectors have begun to recover, starting from the last quarter of 2020. World Bank estimates indicated an estimated growth rate of 3% for Qatar for 2021.
On the authority's role in preparing and implementing double taxation avoidance agreements between countries and evaluating the economic and investment return from these to the state, he stressed the role of the authority is to prepare and negotiate draft agreements to avoid double taxation and prevent financial evasion.
He said Qatar has concluded 88 agreements to avoid double taxation and prevent financial evasion. Negotiations are currently underway with a number of friendly countries with the aim of signing similar agreements, in line with the State's investment orientation abroad, taking into account the investment interests of several parties in the country such as QatarEnergy, Qatar Investment Authority, Qatar Airways, and others, in order to ensure the provision of economic benefits to commercial activities abroad, he said.
