Eisa Alderbasti: Accounting and Auditing

Corporate Tax Law Issued

Business entities in Qatar will be required to pay an annual tax of 10% of their revenues under a new law issued yesterday by HH the heir Apparent and Deputy Emir, Sheikh Tamim bin Hamad Al-Thani.

The tax law will be levied on the revenues of business activities, contracts - which are being partly or wholly implemented properties, including the sales of stakes in the shareholding companies or privately owned companies whose assets are mainly comprised of properties. Revenues of the natural sources, excavation or exploration in the state and the loan interest rates obtained within the state are also taxable.
The law will take effect as of January 1, 2010.

According to article 12, companies subject to income tax will be obliged to register with a department, to be set up later, under the Ministry of Economy and Finance within 30 days of getting the authorities' approval to do business in the country.
Article 14 stipulates that companies shall file annual tax statements showing their incomes subject to tax and the deserved tax value within four months after the end of the tax year.

Companies with a capital exceeding QR 100,000, or with tax-subject income exceeding QR 100,000, or with headquarters located outside the country, will be required to attach a copy of their final results checked by a certified auditor in the state.

Article 30 states that a committee will be set up under the Ministry of Economy and Finance to which companies can file their tax-related complaints and challenge the decision of the department about the estimation of the tax.
Companies failing to file their tax statements will be fined QR 100 for each day's delay with a maximum of QR 36,000.

A penalty of three-month imprisonment term or a maximum fine of QR 15,000 or both penalties will be applied for those who file false information, or try to evade tax by hiding the real income, says article 43.

In addition to the previous penalty, a further fine of 20% of the deserved tax will be applied on companies proved to be in violation of the tax.
Penalties will be tightened in case of frequent violation of the tax law by companies.

Download Changes to Qatar's tax regime and International developments

Paying Taxes 2010

Paying Taxes, a unique study from PwC and the World Bank Group, measures the ease of paying taxes across 183 economies worldwide by assessing both the cost of taxes and the administrative burden of tax compliance.
This year's study was conducted against the backdrop of a global recession, which has meant falling tax revenues around the world, and the need for governments to make difficult tax policy choices. Despite this, it is clear from the study that tax reform remains high on governments' agendas.

The study reveals that Qatar is one of the easiest countries in the world to pay taxes. In fact Qatar is placed second in the list, just below Maldives and above Hong Kong/China who are placed third. It is also noteworthy that among the top 10 countries, three spots are occupied by Arab countries. A measure of the elaborate tax reforms that have been initiated by countries in the region.

Download Paying taxes 2010- A global picture