Expert: UAE rides the digital wave with Value Added Tax (VAT)
It’s just been a few years since digital technologies have transformed our economy and society quicker than anything else.
It’s changed everything from how we work, to how we live and operate.
While the digital wave is upon us, the United Arab Emirates is propelling into the future with the introduction of digital technologies across varied sectors, including Value Added Tax (VAT).
The introduction of VAT in the UAE has encouraged several companies to move from traditional brick and mortar models and scale up their computing processes to be able to match up to UAE’s digital processes.
Mandatory use of digital processes while filing returns and registering for VAT has also helped businesses to manage timely and accurate record-keeping, whilst preventing errors associated with manual processes. In addition, digital processes have also allowed businesses to access tax information in a single place, file returns online from any place and deliver improvements in business processes.
In the UAE, the digital revolution hasn’t been a separate exercise; it is embedded into the operations and DNA of varied sectors, in a way that touches all aspects of the economy. VAT digitalization in the UAE is a step ahead of the curve to engage effectively with businesses, remain competitive, boost productivity and take advantage of the broader benefits and cost-efficiencies that going digital gives.
With automated services taking over VAT, the future promises to make use of technologies as blockchain, artificial intelligence (AI), robotics and much more.
Studies suggest that investment in financial technology (Fintech) is over $22 billion and growing rapidly. This massive sum proves that many are finding tremendous value in the efficiency that new technology promises.
A large push for new tech in Finance and Accounting has the power to revolutionize the field and improve many functions. It will change the way organizations operate as well as alter the responsibilities of those that work for them.
While VAT has triggered a massive wave of digital transformation into the UAE, the country has always been a pioneer with digital technologies.
Digital implementation of VAT has helped close the tax gap by helping businesses to ‘get their tax right’.
As most businesses now use automated tools, the possibility for errors has reduced giving business owners peace of mind in the wake of penalties and fines for non-compliance. In addition, adoption of digital reforms in VAT has smoothened the application process – improving speed, innovation, and security.
VAT implementation has radically transformed the IT processes of the UAE businesses, and will also have a lasting impact on the country’s growing economy.
With more and more businesses using digital tools to operate and file returns, the UAE is certainly moving towards a brighter and smarter future.
This article is written by Tejas Goenka, Executive Director, Tally Solutions – a leading international accounting and compliance software provider.