Dubai nixes its 30% alcohol tax in a bid to draw extra tourism

Media, not the resorts themselves, usually label resorts like Burj Al Arab as “six-star” or “seven-star” resorts.

Waitforlight | Second | Getty Photos

DUBAI, United Arab Emirates — Dubai is scrapping its 30% tax on alcohol gross sales for the remainder of the 12 months, the emirate’s municipality introduced Monday, the most recent transfer in a sequence of liberalizing coverage modifications over the previous couple of years geared toward boosting tourism and attracting extra overseas residents.

“Dubai Municipality has briefly stopped amassing the 30% payment from alcoholic beverage corporations for a interval of 1 12 months from the start of 01/01/2023 to the top of 12/31/2023. The businesses approved to promote within the Emirate of Dubai have been notified of this choice,” the Dubai Municipality wrote in a publish from its official Twitter account.

The transfer is probably going a bid to extend tourism and stimulate extra enterprise amongst each guests and residents as Dubai pushes ahead in its aim to develop into the “happiest place on Earth.” Booze is notoriously dear in Dubai, with a pint of beer usually costing $15 and a glass of wine as a lot as $20 or extra.

Native alcohol distributors introduced the information first, with Dubai-based alcoholic beverage chain Maritime and Mercantile Worldwide (MMI) writing Sunday on its Fb web page, “Now you can: save 30% municipality tax on alcoholic drinks. We have now mirrored this throughout all our pricing!” It added that the UAE’s 5% gross sales tax (VAT) nonetheless applies, nevertheless.

It additionally mentioned that non-public liquor licenses, beforehand a requirement for all Dubai residents for buying alcohol in retailers and costing 270 dirhams ($73.50), at the moment are free. Earlier than Jan. 1, liquor licenses needed to be renewed yearly and had a processing time of about 4 weeks. Shopping for alcohol in bars nevertheless, didn’t require any license.

It isn’t sure whether or not the brand new free licenses will nonetheless have the identical processing occasions or renewal necessities. Dubai can be the one emirate within the United Arab Emirates that required residents to acquire a liquor license for in-shop purchases; in 5 different emirates together with Abu Dhabi, no license was required, and within the UAE’s extra conservative emirate of Sharjah, the sale of alcohol shouldn’t be allowed.

Some Dubai residents had been sad concerning the abrupt announcement, having just lately paid the complete payment for his or her yearly license.

“Simply achieved the licensing couple of days again and paid for it. Can somebody clarify how you can this took place? Why wasn’t this talked about then?!” one Fb consumer wrote in a touch upon MMI’s publish.

“My husband paid for the license 2 days in the past, we want you had mentioned one thing! And he did not get any vouchers as per talked about in your web page and web site. Positively really feel cheated,” one other consumer wrote.

One of many customers mentioned MMI provided her a free bottle of wine as compensation, which she described as “not acceptable.” CNBC has reached out to MMI for remark.

The UAE moved its weekend. Here's what happened next

Extra broadly, residents celebrated and welcomed the information. The announcement additionally comes as neighboring Saudi Arabia ramps up its obvious drive to supplant the UAE because the tourism and industrial capital of the area. Saudi Arabia continues to be a dry nation, and its strict legal guidelines and largely conservative society are limitations for a lot of potential overseas residents.

The UAE, in contrast, and particularly its industrial capital of Dubai is residence to a various 90% expatriate inhabitants and has lengthy provided life similar to these within the Western world. The town has numerous bars, nightclubs and eating places serving alcohol, conservative costume shouldn’t be required, each main faith can arrange locations of worship, and cohabitation earlier than marriage is authorized, whereas in Saudi Arabia and another Gulf Arab states it’s not.

Girl sunbathers sit alongside a seashore within the Gulf emirate of Dubai on July 24, 2020, whereas behind is seen the Burj al-Arab resort.

KARIM SAHIB | AFP by way of Getty Photos

The UAE additionally just lately modified its Islamic weekend of Friday-Saturday to the Western weekend of Saturday-Sunday, to be in step with a lot of the remainder of the world, and started providing a distant employee visa by way of the coronavirus pandemic as extra folks adopted a distant work way of life.

“Dubai has been a transparent standout by way of the pace of which its tourism market has recovered for the reason that pandemic,” Karim Jetha, chief funding officer at Dubai-based asset administration agency Longdean Capital, informed CNBC.

“The choice to droop alcohol taxes follows strikes to vary its weekend to Saturday-Sunday and the widening of entry to long-term residency visas. As a collective, these initiatives are ought to enhance tourism and encourage extra expatriates to think about Dubai as their residence,” he mentioned.

Leave a Comment