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DUBAI: The UAE government has approved the country’s federal budget for 2024-2026 worth 192 billion dirhams ($52.3 billion), Prime Minister and Dubai ruler Sheikh Mohammed bin Rashid Al Maktoum said on Monday.
RIYADH: Kuwait is poised to reform its tax system in its efforts to join the OECD/G20 Inclusive Framework on base erosion and profit shifting, as it is the only Gulf Cooperation Council state that has yet to become a member.
BEPS refers to tax planning strategies used by multinational enterprises that exploit gaps and mismatches in tax rules to avoid paying tax, according to the official website of the Organisation for Economic Co-operation and Development.
The Kuwaiti government is set to introduce a new corporate tax initiative, known as the “Business Profits Tax Law,” as part of a complete plan to revamp the existing tax framework. This reform will be implemented in two stages and is expected to be fully phased out as early as 2025.
The BPT would impose a 15 percent tax on the profits of a wide range of operating structures, including corporate entities, partnerships, and businesses with separate legal existence, all established, incorporated, or operating in Kuwait. However, individuals, micro and small enterprises will be exempt.
Currently, only foreign companies exercising business or trade in Kuwait are subject to tax on their profits and capital gains income.
Effective Jan.1, 2025, Kuwaiti multinational companies including government entities operating in overseas markets, with annual revenues exceeding €750 million ($806 million) will be subject to the proposed BPT.
It is also proposed that the BPT will be implemented as an amendment to the existing tax laws. This is in line with the Pillar Two framework being implemented globally.
The existing Kuwait corporate income tax law imposes a tax on the income of any body corporate, wherever incorporated, earning income from Kuwait source.
In practice, no income tax is currently imposed on companies incorporated in the GCC and entirely owned by citizens of the GCC. Corporate income tax is currently only imposed on income earned by non-GCC (foreign) companies.
Due to globalization and the digitalization of businesses, tax authorities observed that multinational corporations were shifting their profits from countries with a high corporate tax rate to countries with a low tax rate, in order to reduce their global effective tax rate.
RIYADH: Saudi Arabia’s space industry holds great potential for growth after recording $400 million in revenue in 2022, according to a recent report.
The sector, expected to reach an average annual value of $2.2 billion from 2023 to 2030, holds significant opportunities, as highlighted by a document from the Saudi Communications, Space and Technology Commission.
The development of distinct sovereign capabilities for spacecraft is expected to become a pivotal subsector within the Kingdom.
The report highlighted the small satellite manufacturing market is projected to reach $68 billion in the region by 2030.
Furthermore, around 148 satellites are set to be launched in the Middle East by 2030, presenting a largely untapped market opportunity.
The report also presented the challenges accompanied by such ventures. It stated that a highly competitive global market, in addition to heightened supporting costs, could hinder growth.
However, key enablers such as a space sectoral fund for local players, incentivization programs, and upskilling initiatives can offset these challenges and reduce barriers, the report stated.
Launch services will also play a prominent role in the sector. The report stated that developing and operating a national spaceport, as well as localizing small launcher operations, are amongst the best opportunities in this subsector.
Partnering with ground networks for capability building and hosting ground stations are amongst the opportunities in the ground segment, which is set to reach a value of $5 billion worldwide by 2030.
Furthermore, satellite-based communication connectivity services will also play a crucial role in the sector’s overall growth, coupled with Earth observation and space exploration.
Another promising subsector highlighted is sixth-generation technology, which is anticipated to generate $45.5 billion in value if applied in the Kingdom.
The report also underscored that the space tourism market is expected to reach $600 million by 2030.
On a global level, government investment in space in 2022 reached $100 billion among 86 countries. In the Middle East, the amount invested was $1.2 billion in 9 countries.
The report further highlights that the global space economy is set to reach $738 billion in 2030 from $464 billion in 2022.
RIYADH: Saudi developer Red Sea Global will own and operate its own luxury hotel brand, Shebara, in the giga-project, it has revealed.
The announcement was made at the World Travel Market in London on Nov. 6, with the hotel – situated on Sheybarah Island within the Al Wajh Lagoon – scheduled to open its doors in the summer of 2024, according to a press release by the company.
Shebara joins a list of international hospitality brands already present at The Red Sea, including St. Regis, Ritz Carlton Reserve, and Six Senses, which began welcoming guests this month.
This announcement follows RSG’s plan to develop the Thuwal Private Retreat, an exclusive island destination, also entirely owned and operated by the company.
“It has long been our mission to extend our pioneering approach to regenerative tourism across a wider portfolio of brands and subsidiary companies, to create an ecosystem that will drive meaningful change in the global tourism industry,” Group CEO of RSG John Pagano said.
“Shebara is a beacon for all that RSG stands for, showcasing the very best in Saudi hospitality while setting new standards in responsible development and sustainable operations,” he added.
The resort is currently in the process of forming an operational team for its upcoming launch.
It will consist of 73 rooms, including overwater and beach villas, and can be reached by a 45-minute boat ride from the mainland or a 20-minute seaplane journey, the release added.
Its design, which will be developed by UAE’s architecture firm Killa Design, centers around reflections of nature.
Design Director and founder of Killa Design Shaun Killa said: “Shebara is a wonderful example of what is possible when creating beautiful yet meaningful design. It demonstrates how innovative architecture can gracefully flow into nature, with pods that reflect and refract light from the sun, the sky and the sea to naturally blend with the environment.”
He added: “From the eco-materials chosen to the lunar positioning of the villas, our priority has been to honor the natural beauty that exists here, while creating a resort that embodies modern luxury.”
In addition to this, the new resort will be completely powered by sunlight with its own dedicated solar farm, which includes more than 11,000 photovoltaic panels.
RSG has already constructed five solar farms to power the first phase of the destination.
The new hotel comes as the hospitality sector in the Kingdom is experiencing robust growth, with the 2030 target of 100 million visitors revised up to 150 million visitors, the minister of tourism disclosed last month.
In a session titled “What is the Vision for High-Growth Industry” on the first day of the Future Investment Forum which took place in October, Ahmed Al-Khateeb explained that the Kingdom expects to reach its original goal by the end of 2023.
RIYADH: Saudi Arabia’s Tadawul All Share Index concluded its Monday trading at 10,948.86 points, recording an increase of 9.91 points or 0.09 percent.
Meanwhile, the parallel market Nomu concluded at 22,616.54 points, reflecting a gain of 32.16 points or 0.14 percent. The MSCI Index also registered a rise of 5.99 points, closing at 1,423.39, indicating a growth of 0.35 percent.
By the end of the trading day, the primary index recorded a total trade value of SR6.1 billion ($1.6 billion) with 74 stocks advancing and 147 declining. In contrast, Nomu reported a trading volume of SR10.2 million.
On the corporate front, Dallah Healthcare Co. released its financial results for the first nine months of 2023, reporting a net profit of SR246 million, representing a 25.74 percent growth compared to the same period last year.
This increase in profit can be attributed to a 19.11 percent surge in the company’s revenue, rising from SR1.79 billion to SR2.13 billion during the corresponding timeframe, according to a bourse filing.
The positive performance is linked to an increase in patient visits across the company’s hospital network and higher occupancy levels in both inpatient and outpatient services, stemming from the expanded operational capabilities of the company’s medical facilities.
As a result, the company’s stock price closed with a 5.59 percent increase, reaching SR158.80.
Saudi Aramco’s base oil company Luberef also disclosed its financial results for the same period, reporting a net profit of SR1.24 billion, reflecting a growth of 2.15 percent.
This boost in net income can be primarily attributed to a reduction in zakat and income tax expenses, as Luberef has transitioned to being subject to zakat only following its listing. On Monday, the company’s stock price closed at SR136.80, a 3.01 percent increase.
In addition, Saudi Reinsurance Co. reported a 55.09 percent growth in its net profit during the first nine months of the year, reaching SR121 million, compared to SR78 million in the previous year.
The company attributed this increase to a reduction in reinsurance service expenses and a rise in net investment income. However, the company’s stock price experienced a 1.32 percent decline at the close of the day, ending at SR17.94.
On the downside, Abdullah Al Othaim Markets Co. witnessed a substantial drop in its net profit during the same period, declining by 64.5 percent to close at SR321.8 million, despite an 8.26 percent growth in revenue.
The company stated that the loss was primarily due to SR798.1 million in investments during the period, and without this allocation, profits would have recorded an 8.3 percent growth.
Following this significant decrease, the company’s stock price saw a 2.11 percent fall on Monday, closing at SR12.98.
In other developments, the National Agricultural Development Co. received approval from its general assembly to raise capital by SR2 billion through a rights issue.
Tadawul will adjust NADEC’s share fluctuation limit based on an SR22.54 baseline on Nov. 6, with rights shares allocated on Nov. 8.
RIYADH: Riyadh is on the path to becoming a major regional hub for international companies with the launch of a new special economic zones center.
Established by the Royal Commission for Riyadh City, this strategic move is aimed at elevating the Saudi capital’s stature as one of the world’s largest city economies.
The initiative aligns with national transformation goals for economic diversification.
The center will empower the Royal Commission to oversee the special economic zones within Riyadh City, creating a competitive environment that promotes economic growth.
The new facility would be financially and administratively independent, allowing it to develop new economic zones in the Saudi capital.
It will also be responsible for granting licenses to investors in these zones, offering comprehensive services based on international best practices.
By doing so, it will allow for the recruitment of both national and international talent and expertise to work with the new businesses and firms in the center, ultimately expanding opportunities and establishing an attractive investment climate.
Moreover, the center will contribute to Riyadh’s transformation into one of the world’s largest city economies by creating a competitive regulatory environment for a broad spectrum of economic activities.
A cooperative framework will be established between the center and the Royal Commission for Cities and Special Economic Zones to develop strategies for the economic areas, ensuring alignment and leveraging the experiences of both entities.
This initiative will play a significant role in cementing Riyadh’s status as a regional hub for global corporations, particularly within the Kingdom. It will bring diversification to Riyadh’s economic foundation and transform the city into a global investment destination.
Additionally, it will contribute significantly to the objectives of Vision 2030 by generating fresh avenues for quality investments through collaboration with government entities, stakeholders, and partners.
This will be achieved through the development of policies and incentives that enhance the capital’s value addition, streamline business activities, and draw regional and global firms to Riyadh City’s special economic zones.
In April, Crown Prince Mohammed bin Salman unveiled the establishment of four new special economic zones, strategically positioned in Riyadh, Jazan, Ras Al-Khair, and King Abdullah Economic City.
These zones are poised to open up exciting opportunities for international investors, as reported by the Saudi Press Agency.