It has been almost two years since the GCC states launched their Value Added Tax and has ushered in new requirements for companies or tax firms. With this in mind Ahmed AlMaqabi, CPA Head of eTaxChain decided to use technologies such as Blockchain and Cloud to help alleviate the burdens of time and cost when it comes to dealing with tax returns.
AlMaqabi has an extensive background in the audit industry as a Certified Public Accountant with experience in Bahrain, USA, Kuwait and Saudi Arabia. He is also an avid tech advocate. As he explained, “The bulk of work in the tax industry has been manual with little tech involvement. In addition there are many challenges whether you are company on the receiving end, a tax firm or a tax regulator.”
“Tax compliance requires everything from adjusting accounting software to hiring a tax advisor incurring additional costs as a company and additional charges and man-hours as a tax firm. Most tax firms either hire more talents or have employees put in more hours to cater to their clients. In addition, tax regulators have the responsibility among many tasks to validate return filings , “adds AlMaqabi.
AlMaqabi decided to utilize blockchain for taxation sector. He says, “I realized when learning about blockchain that this could be the solution needed, given the inherent recording and verification feature which may be applied to tax transaction and the interaction between three main stakeholders, the companies, the tax firms, and the regulators. So I formed my startup a few years ago to eliminate the manual processes.”
eTaxChain is a Blockchain / Software as a Service solution built on R3 Corda platform using Amazon Web Services (AWS). As for the launch the eTaxChain will first be launched in Bahrain with plans to expand across GCC including UAE and KSA.
According to AlMaqabi he chose Corda because it is a well trusted platform in the banking sector and incorporates all the elements needed for the solution including smart contracts. He does however mention that they are continuously reviewing other platforms and are ready to shift if and when needed.
eTaxChain will help companies, tax firms and regulators prepare and check tax return in real-time at frictional cost saving time and cost on companies, tax firms and regulators. As AlMaqabi explains, “ by introducing eTaxChain we are saving some companies between 50% – 90% of the cost and instead of people sending manpower to get the work done, people will use the power of the technology. We offer a license fee per month that is as low as 19 Bahraini Dinars and a maximum of 199 Bahraini Dinars per month depending on requirements and size of company.”