Tax accountant salaries surge as Gulf VAT-day approaches

Women walk past a shop at the Gold and Diamond Park in Dubai. The UAE and other Gulf countries are set to introduce a tax on goods from January next year. (Reuters)
Updated 14 October 2017

Tax accountant salaries surge as Gulf VAT-day approaches

LONDON: The introduction of VAT in the Gulf is stoking salaries for tax specialists across the region, according to recruitment firms.
With just over 11 weeks to go before companies start to add value added tax on their invoices, companies are busy hiring accountants with VAT expertise while big firms such as PwC run courses to meet anticipated demand.
“Candidates who are VAT specialists can expect to be paid well given the demand for their skill set and the shortage of qualified candidates with it,” Andy Georgeson, senior consultant at Michael Page Finance, told Arab News.
Salaries vary considerably but VAT managers in the UAE currently earn between 30,000 to 40,000 dirhams ($8,185-$10,890) per month — but rising considerably for senior roles in large corporations.
PwC last month introduced the first VAT diploma across the Gulf as some companies favor upskilling existing workforces rather than hiring new staff in order to get ready for the introduction of the new tax from January next year.
The need to give people the skills and knowledge to implement and comply with the new tax was, according to Amanda Line, PwC’s academy partner, why PwC introduced the VAT diploma.
“I am confident that this qualification will be fundamental in upskilling specialized tax professionals who can then prepare their organizations for VAT compliance,” Line said.
The introduction of the new tax is benefitting the Big Four accountancy firms as companies outsource tax advice to consultants, Georgeson added.
Yet despite the imminent introduction of VAT, some companies are burying their heads in the sand, said Chris Greaves, managing director of Hays in the Gulf.
“Our ‘VAT in the UAE’ report, released earlier this year, found over half of organizations based in the region did not have a strategy in place for VAT implementation.
“Of those that do, we are noticing that they are either absorbing VAT requirements into their existing workforce — some using their oversees teams for support, or outsourcing activity by engaging with external consultancies.”
He said it was difficult to predict how the introduction of VAT will affect hiring demand until it is up and running.
“There are still laws to be announced but once these are confirmed, there may well be an uplift in hiring as organizations become clearer on what they still need to achieve in order to meet the deadline.”
That view was shared by Georgeson, who added: “We are currently working on multiple VAT roles across the UAE and Saudi Arabia but we certainly expect this to grow as we get closer to the implementation date and thereafter.”
As many as 5,000 finance and accounting jobs could be generated with the introduction of VAT in the region, estimated Paul Drum, head of policy at CPA Australia.
Saudi Arabia and the UAE have both set VAT at a rate of 5 percent. The pair are the first to have introduced VAT legislation since all six members of the Gulf Cooperation Council (GCC) agreed in 2016 to introduce the tax.


Japan lower house passes US trade deal to cut tariffs

Updated 13 min 59 sec ago

Japan lower house passes US trade deal to cut tariffs

  • Doubts remain over elimination of car import levies under prime minister’s ‘win-win’ agreement

TOKYO: Japan’s lower house of Parliament approved on Tuesday a limited trade deal Prime Minister Shinzo Abe agreed with the US, clearing the way for tariff cuts next year on items, including US farm goods and Japanese machine tools.

But there is uncertainty over how much progress Japan can make in negotiating the elimination of US tariffs on its cars and car parts, casting doubt on Abe’s assurances the deal he signed with US President Donald Trump was “win-win.”

Japan and the US last month formally signed the limited trade deal to cut tariffs on US farm goods, Japanese machine tools and other products while staving off the threat of higher US car duties.

The government’s proposal to ratify the trade deal will next be brought to the upper house for a vote, but its passage in the powerful lower house increases the chances it will come into force in January.

FASTFACT

Japan and the US last month signed a limited trade deal to cut tariffs on US farm goods, Japanese machine tools and other products .

The deal will give Trump a success he can trumpet to voters, but Abe has said it will bring as much benefit to Japan as to the US.

Japan has estimated the initial deal will boost its economy by about 0.8 percent over the next 10-20 years, when the benefits fully kick in. It also estimated 212.8 billion yen of overall tariffs on Japan’s exports to the US will be reduced.

But the figures were based on the assumption the US would eliminate its tariffs on Japanese autos and auto parts — a major sticking point.

Without those tariff cuts, the reduction in overall US tariffs on Japanese goods would be a little over 10 percent of the government’s projection, according to Japan’s Asahi newspaper and Mitsubishi UFJ Research and Consulting.

After the deal is ratified, Japan and the US have four months to consult on further talks, and Trump has said he wants more trade talks with Japan after the initial deal.

But Japanese government sources familiar with the talks say the momentum to negotiate a deeper deal appears to have waned for now with Washington preoccupied with talks
with Beijing.

“It is unclear whether Washington seriously wants to continue trade talks,” one of the sources said.

“The question is how much time the US can allocate for talks with Japan, even if we start negotiations. There is limited time to conclude talks before the presidential elections.”

Japan and the US already appear to have different interpretations of what was agreed on car tariffs.

Japan has said it has received US assurance that it would scrap tariffs on Japanese cars and car parts, and that the only remaining issue was the timing.

But Washington has not confirmed that.

US Trade Representative Robert Lighthizer has said cars were not included in the agreement, and that it was only Japan’s ambition to discuss car tariffs in the future.

A US document only said customs duties on autos and auto parts “will be subject to further negotiations with respect to the elimination of customs duties.”

“The deal was left vague on the issue of tariff cuts on Japanese auto and auto parts. Otherwise, we couldn’t have reached the agreement,” another source said.

There is also uncertainty on whether Trump will drop threats to impose steep tariffs on Japanese car imports under “Section 232” that gives him authority to do so on national security grounds.

Abe said he had received an assurance from Trump that he would not do that, though analysts say the president could always change his mind, or at least keep Japan guessing.

Opposition parties have attacked Abe for a deal they say is unfair. Critics say Trump could drag
his feet on further negotiations unless he is sure he can win more concessions.

“There is a chance Trump will put pressure on Japan on trade to appeal to his voters,” said Junichi Sugawara, senior research officer at Mizuho Research Institute. “There’s a possibility he could
renew his threat over auto tariffs.”