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on a stand-alone basis, while implementing it
        in their respective Companies and structuring
        a transaction  which  optimizes  the   impact of  a
        specific type of tax or do they have to take a holistic
        view on all the applicable laws, regulations and
        standards and ensure consistency of treatment of
        any business transaction, with all the applicable
        laws, regulations and standards, which at times
        could create challenges in the most optimal tax
        structuring  of that transaction.  This is what is
        commonly described as ‘The Consistency Dilemma’
        that all the Businesses commonly face.

         The question which needs to be answered under             TAX
        ‘The Consistency Dilemma’ is as to which is the
        correct approach before taking the position on
        the treatment or structuring of any given business
        transaction.

         My view on this ‘Dilemma’ is that whilst it
        is important that a holistic view of analysis
        and evaluation of all the applicable laws,
        regulations and standards should be
        done by the Businesses before taking the
        position on the treatment or structuring
        of any given business transaction.
        Though at the same time,  it has to be
        understood that the same terms used in
        various laws, regulations and standards
        can have a different meaning, scope and
        implications.                                         Therefore, given that this ‘Dilemma’ can at

         Thus, the meaning, scope and implications of a       times be very complex for businesses to address
        given term in each law, regulation and standard       appropriately, so I would like to conclude with the
        has to be analyzed in that specific context, for the   guidance issued by Ministry of Finance of UAE with
        purpose of arriving at a holistic conclusion as to    a little bit of twist: “When in Dilemma, please seek
        the correct treatment or structure for any given      Professional Advise.”
        business transaction. Some of the examples of the
        same terms having different meaning, scope and
        implications under different laws and regulations
        are the term ‘Imports’ could have a different
        meaning, scope, implications and context in the
        various indirect tax laws in UAE i.e. Customs Law,
        VAT Decree Law and Excise Tax Law, than what it
        has got under the ‘Economic Substance Regulations
        (ESR)’. Similarly, the meaning, scope, implications
        and context of the term ‘Lease Finance Business’
        under the ‘Economic Substance Regulations (ESR)’
        could be potentially different than the same term     CA Mayank Sawhney
        defined under the ‘Federal Financial Leasing Law of
        UAE.’

         Disclaimer:
         This article and/or write ups and/or any of its content shall not be treated as opinion and/or advice in any circumstances of the author(s) and/ or the Chapter. Reader’s to apply their best
        judgement in the best interest of their requirement and should seek a formal opinion on any issue.


              The Institute of Chartered Accountants of India (Dubai) Chapter NPIO           TAX JOURNAL 2020    53
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