Dubai has suspended its 30 per cent tax on alcohol sales for a trial period of a year and nixed a mandatory liquor licence fee in an attempt to stay ahead of increased tourism competition in the Gulf.
Famous for its bottomless boozy brunches in hotels, the removal of Dubai’s alcohol tax is expected to further boost the emirate’s appeal to tourists and expat residents who are drawn by the more liberal lifestyle in comparison to other Gulf cities.
The changes started on 1 January and will be trialled for a year, according to Dubai’s two state-linked alcohol retailers Maritime and Mercantile International (MMI) and African & Eastern.
The emirate has loosened liquor regulations previously, including selling alcohol during Ramadan daylight hours and introducing home delivery during COVID-19 lockdowns.
Dubai’s economy rebounded swiftly from the COVID-19 pandemic with GDP growing 4.6 per cent year on year for the first nine months of 2022.
Tourism is a key pillar of the Dubai economy with visitor numbers up more than 180 per cent in the first half of 2022 compared to 2021.
Dubai aims to attract 25 million visitors in 2025 as national carrier Emirates increased its flights and routes in 2022.
The UAE also announced it will introduce a nine per cent corporate tax in June 2023 as other Gulf states turn to VAT to boost non-oil revenue.
Via Reuters
