Taxation in Britain is often a vexation to Middle East visitors, investors and business people. There is value added-tax (VAT), customs duty, income tax, capital gains tax, company tax, municipal rates, land registration duty, airport tax and finally – at the end – estate duty. The VAT alone is enough to drive you mad.
There is no VAT on books. I can buy Hamlet in book form without paying any VAT, but if I go to see the play, they will charge me VATon my ticket. My friend,Sheikh Fadhil ibn al-Khair Alla was puzzled when he visited London on a business matter. Having exhausted himself with endless business meetings and discussions, he thought of seeking some diversion away from the moneyed world, whereupon he ordered the services of a buxom blonde hostess. The following day, he asked me,
“Khalid, what is this BBT, TGE, MCT and what have you?”
“I don’t know Sheikh. What is it? Tell me something about it, the circumstances you came upon it for example, to be able to answer your question,” I replied. My friend the Sheikh told me then, that he took the pretty lady for a good dinner and spent the night with her. In the morning they shared an excellent English breakfast of fried eggs, fried tomatoes and mushrooms together with butter and marmalade. No bacon or pork sausages though, as he was a very good Muslim. He paid the lady her fees of one thousand pounds, which she put in the precious and sparkling new handbag which he bought for her. ‘ The woman then asked me for a further sum of one hundred and fifty pounds (now it would be £200). I asked her what the extra money was for? She said this was for the PTE , the TMG or some such collection, I don’t remember. What was this my dear Khalid?’
“Oh! Now I understand,”I told him.”She was charging you VAT.”
“And what is that”? my friend responded.
“This is a tax charged in England for ‘value added’. You had some ‘value added’ from her, or she had some ‘value added’ from you. She obviously thought so. English people are very strict and proper. They don’t charge you for nothing”.
I was invited a few months later to a lavish banquet for a peace award ceremony organised by a Middle East peace organisation. Unbeknown to me, during the ceremony I was suddenly declared the winner of the organisation’s annual peace award, which was unfortunately not in £ sterling but in the form of a one foot high olive tree. I was then invited to the platform to declare my acceptance of the one foot sapling and to say a few words. It was then that I related the story of my friend Sheikh Fadhil and the VAT he was made to pay.
“My lords, ladies and gentlemen,’ I went on to say to the assembled company: “Peace in the Middle East is a very precious commodity, certainly more precious than all the oil produced there.
As a law abiding citizen however, I must first ask the Chairman, is this little olive tree of peace fully VAT paid? I see that there is an instruction leaflet on how to plant it. But I don’t see a VAT number. I don’t want The Jewish Chronicle publishing my name tomorrow under a bold heading ‘Arab writer breaks English law!’ Before taking this tree out of this august building, I must verify whether peace in the Middle East is a VAT registered commodity under Her Majesty’s Government’s laws.