Arab News – Leaders of the six-nation Gulf Cooperation Council (GCC), gathering in Riyadh on Wednesday (today), will discuss key regional and international issues, which is expected to include the fight against terrorism, closer economic cooperation and the situation in Syria, Yemen, Palestine and other neighboring states.
The two-day Supreme Council gathering is the 36th meeting since its formation in 1981, and will see Custodian of the Two Holy Mosques King Salman take the chair for the first time. King Salman chaired the GCC advisory council in May, the annual meeting of GCC leaders traditionally held in Saudi Arabia where the council is headquartered, according to reports.
GCC leaders have agreed to meet twice a year, in May and December. The May summit is usually used to assess progress on the implementation of decisions issued by the previous summits and discuss the latest regional and international developments, according to reports.
There is tight security in the Saudi capital, with the main thoroughfares adorned with the flags of the member states, which include Bahrain, the United Arab Emirates, Oman, Kuwait and Qatar.
The foreign ministers of the six countries held their preparatory meeting in Riyadh on Monday to finalize the agenda for the summit. The GCC summits are held on a rotating basis according to the Arabic alphabet. Doha hosted the last summit.
There have been reports that the GCC has agreed to key issues for implementing value-added tax (VAT) in the region, moving the six nations closer to introducing direct taxation for the first time.
The agreement was reached at a meeting of representatives from Gulf ministries a few days ago. Introducing VAT would be a major economic reform in the GCC, which have minimal tax systems and no tax on income, although some levy fees such as road tolls, one report stated.
The plunge in oil prices since last year has slashed government incomes, making it more urgent for them to find new revenue. The target for introducing the tax is three years, and it would take 18 to 24 months to implement once a final agreement has been reached, the report stated.
There would reportedly be zero tax on health care, education, social services sectors and 94 food items. No indication of the rate at which VAT will be levied has been given by governments, although the International Monetary Fund has suggested a 5 percent rate.
Riyadh has previously played host to six GCC summits, starting with the second one, which was held in November 1981 at an invitation of the late King Khalid. The eighth summit was held in Riyadh from Dec. 26 to 29, 1987, on the invitation of the late King Fahd, according to the Saudi Press Agency.
On Nov. 27, 1999, the late King Fahd opened the 20th session of the Supreme Council. On Dec. 9, 2006, the late King Abdullah opened the 27th meeting in Riyadh, where he outlined the need for closer GCC cooperation on the economic front.
On Dec. 19, 2011, Riyadh hosted the 32nd Supreme Council meeting of the GCC which was opened by King Abdullah, who emphasized that the six nations needed to move from a phase of cooperation to one of complete unity.
At a press conference after the gathering, the late foreign minister Prince Saud Al-Faisal and the GCC Secretary General Abdullatif bin Rashed Al-Zayani said that the leaders had agreed to form a panel consisting of three members from each country to study all aspects of the proposal.
The objectives of the GCC include similar regulations in various fields such as religion, finance, trade, customs, tourism, legislation and administration. The six nations also seek to foster scientific and technical progress in industry, mining, agriculture, water and animal resources; establish scientific research centers; set up joint ventures, establish a unified military; encourage private sector cooperation and establish a common currency.
In 2014, Bahrain, Kuwait, Qatar and Saudi Arabia took major steps to ensure the creation of a single currency. The four members are pushing ahead with the monetary union but said some “technical points” need to be cleared. A common market and common central bank would also position the GCC as one entity that would have great “influence on the international financial system,” one official was quoted as saying.