Dubai temporarily makes alcohol cheaper to compete with tourists | abroad

Dubai no longer imposes taxes on the sale of alcoholic beverages. It is a temporary measure that will be in place for a year, and seems intended to attract more tourists and expats.

Two of the state’s alcohol retailers announced on New Year’s Day that the 30 percent tax on alcohol sales had been temporarily abolished. The required consumer license fee is also free, Maritime and Mercantile International (MMI) and African + Eastern reported on social media.

MMI, owner of 21 liquor stores in Dubai, wrote the above ads on his Instagram account “Buying drinks is now easier and cheaper than ever: no more than 30% tax, free alcoholic beverage license, and no more long trips to store. ” Many Dubai residents travel to Umm al-Quwain and other emirates 61 kilometers to the north to purchase the substantial duty-free alcoholic beverages.

African + Oriental with seventeen liquor stores, advertising with slogans like “tax free” and “no charge” (for liquor license). Both series indicate that alcohol prices will still be subject to a 5 percent sales tax.

With the abolition of the alcohol tax on a liquor license, the emirate’s hospitality sector can now also purchase cheaper alcoholic beverages. It remains to be seen if customers will benefit from this. A glass of beer (0.33cl) now quickly costs between 8 and 12 euros.

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A waitress serves beer to customers at a Dubai restaurant. ©AP

previously relaxed rules

The temporary measures stem from a government decision from the ruling Al Maktoum family. Government officials have not yet officially confirmed the decision, nor did they respond to questions from the Associated Press.

Relatively liberal Dubai has already relaxed rules on the sale of alcohol in recent years, for example, daytime sales are allowed during Ramadan, and home deliveries were allowed during lockdowns at the start of the coronavirus pandemic. With the abolition of the tax on alcohol sales, the Al Maktoum family loses a source of income, but they seem to be taking it for granted in an effort to boost tourism in the emirate.

competition in the Middle East

The emirate faces increasing competition from other countries in the Middle East. For example, Abu Dhabi, the capital of the United Arab Emirates, located 140 kilometers to the south, abolished its alcohol licensing system in September 2020. The emirate is actively promoting as a tourist destination under the slogan ‘Discover Abu Dhabi.

Hardline Islamist Saudi Arabia, which opened its borders to tourists in 2020, is doing the same with the crackdown Visit Saudi ArabiaThe development of tourism is an important growth engine for the future of the Kingdom and one of the main pillars of the Vision 2030 plan. This would help diversify the economy and reduce its dependence on oil, according to the website of the Tourism Authority. The conservative state of Qatar also presents itself as a tourist destination and launched the global campaign in the period in which Preceding the FIFA World Cup.Feel more in Qatar“.

Other tax procedures

Dubai has the great advantage of allowing alcohol there, which is not the case in Saudi Arabia, and the sale and consumption of alcoholic beverages is not subject to strict rules as in Qatar. The temporary suspension of the alcohol tax comes as the United Arab Emirates, which includes seven emirates the most famous of which are Abu Dhabi and Dubai, prepares to introduce a 9 percent corporate tax on top of other taxes. This will take effect in June.

It is not clear if there is a link between the two tax measures. Alcoholic beverage distribution company MMI, part of the wider Emirates Group, wrote on Sunday in a statement announcing the abolition of the 30 percent tax on alcohol that “these recently updated regulations are necessary to ensure the safe and responsible purchase and consumption of alcoholic beverages in Dubai and the UAE.”

licenses

Non-Muslims must be 21 years or older in Dubai to consume alcohol. They are supposed to hold alcohol licenses (issued by Dubai Police) that allow them to purchase, transport and consume beer, wine and spirits. Otherwise they risk fines and arrest, although plastic cards are rarely required in bars, nightclubs and lounges.





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