Three-quarters of GCC firms have yet to engage with their tax advisor on the subject of value-added tax (VAT), study claims.

A survey showed that the vast majority – 88% – of respondent firms have not made budgetary provision for VAT, despite analysts predicting it will increase costs for businesses and add at least 2 percentage points to inflation in 2018.

The survey of 330 company representatives by Thomson Reuters and the Association of Chartered Certified Accountants (ACCA) revealed Gulf firms are woefully unprepared for the introduction a 5% GCC-wide VAT next year.

As well as finding that only a quarter of firms had engaged with a tax advisor on VAT, despite this being “crucial in any VAT implementation project”, the survey found that just 12% of organizations had budgeted for VAT implications in 2017.

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