Following the withdrawal of the Decree issued on 2 April 2020 concerning the prepayment of 30% of the VAT due by taxpayers referred to in the Amending Law (No. 2) of 2020 (hereinafter ‘Amending Law’), the Council of Ministers proceeded on 16 April 2020 to the issuance of a new Decree which essentially requires a number of taxpayers to submit monthly instead of quarterly tax returns.
The new decree seeks to strengthen the government’s cash liquidity while taking into account the cash needs of affected companies. As in the case of the previous Decree, which was withdrawn, the new Decree was issued on the basis of Article 23, which the Council of Minister may invoke during times of economic crisis.
This new Ministerial Decree (MD) affects the tax obligations of the following two categories of taxpayers:
•Those whose economic activity code is referred to in the Amending Law(Category A); and
•Those whose economic activity code is not included in the Amending Lawbut according to the data held by the Tax Department (TD) are consideredas large taxpayers (Category B).
Taxpayers falling under the above categories will receive a notification from the TD which will give directions as to the time of submission of the tax returns and how to pay the VAT due.
It is pointed out that taxpayers who fall into category B will be asked to pay 30% of the amount due in each case as opposed to those who fall into category A who will be required to pay the full amount due.
It is clarified that the decree does not mention how long it will be valid for but the notification of the TD will specify that the monthly submission will be effected for the months of March until June 2020.
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