The media, not the hotels themselves, often refer to hotels like Burj Al Arab as “six-star” or “seven-star” hotels.
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DUBAI, United Arab Emirates – Dubai is scrapping its 30% tax on alcohol sales for the rest of the year, the emirate’s municipality announced on Monday, the latest move in a series of liberalizing policy changes in recent years aimed at boosting tourism and attracting more foreign residents.
Dubai Municipality has temporarily stopped collecting the 30% levy from liquor companies for a period of one year from the start of 01/01/2023 to the end of 31/12/2023. Companies authorized to sell in the Emirates of Dubai have been informed of this decision,” the Dubai Municipality wrote in a message from its official Twitter account.
The move is likely an attempt to increase tourism and stimulate more business among visitors and residents as Dubai moves forward in Its goal is to become “the happiest place on Earth”. Alcohol is notoriously expensive in Dubai, with a pint of beer often costing $15 and a glass of wine up to $20 or more.
Local liquor distributors broke the news first, with Dubai-based liquor chain Maritime and Mercantile International (MMI) writing on its Facebook page on Sunday: “You can now: save 30% municipal liquor tax . We have reflected this in all of our pricing!” He added that 5% UAE sales tax (VAT) still applies.
He also said personal liquor licenses, previously compulsory for all Dubai residents to buy alcohol in shops and costing 270 dirhams ($73.50), are now free. Prior to Jan. 1, liquor licenses had to be renewed annually and had a processing time of approximately four weeks. However, the purchase of alcohol in bars did not require a license.
It is not certain that new free licenses will always have the same processing times or renewal requirements. Dubai is also the only emirate in the United Arab Emirates that required residents to obtain a liquor license for in-store purchases; In five other emirates, including Abu Dhabi, no license was required, and in the more conservative emirate of the United Arab Emirates, Sharjah, the sale of alcohol is not permitted.
Some Dubai residents were unhappy with the abrupt announcement, having recently paid their annual license fees in full.
“I just passed the license a few days ago and paid. Can anyone explain how this happened? Why wasn’t this mentioned then?” a Facebook user wrote in a comment on MMI’s post.
“My husband paid for the license 2 days ago, we wish you had said something! And he did not receive any voucher as shown on your page and website. I really feel cheated,” wrote one other user.
One of the users said that MMI offered her a free bottle of wine as compensation, which she called “unacceptable”. CNBC has reached out to MMI for comment.
More broadly, residents celebrated and welcomed the news. The announcement also comes as neighboring Saudi Arabia steps up its apparent drive to supplant the United Arab Emirates as the region’s tourism and business capital. Saudi Arabia is still a dry country, and its strict laws and largely conservative society are obstacles for many potential foreign residents.
The United Arab Emirates, on the other hand, and in particular its commercial capital, Dubai, is home to a 90% diverse expatriate population and has long offered lifestyles comparable to those of the Western world. The city has countless bars, nightclubs and restaurants serving alcohol, conservative dress is not required, all major religions can establish places of worship, and cohabitation before marriage is legal, while in Saudi Arabia and some other Gulf Arab states, this is not the case.
Women bathers sit along a beach in the Gulf emirate of Dubai on July 24, 2020, while behind is the Burj al-Arab hotel.
Karim Sahib | AFP via Getty Images
The United Arab Emirates also recently changed its Islamic weekend from Friday-Saturday to Western weekend from Saturday-Sunday, to be in line with much of the rest of the world, and started offering a worker visa to distance during the coronavirus pandemic as more and more people adopted a remote working lifestyle.
“Dubai has clearly stood out in terms of the speed of recovery of its tourism market since the pandemic,” Karim Jetha, chief investment officer of Dubai-based asset management firm Longdean Capital, told CNBC.
“The decision to suspend alcohol taxes follows the decision to change its weekend to Saturday-Sunday and the expansion of access to long-term residency visas. As a collective, these initiatives should boost tourism and encourage more expats to call Dubai home,” he says.
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