Rome – Dubai ended its 30% sheikhdom sales tax on Sunday and made the required liquor licenses cheap to obtain, ending a longtime source of income for his family in power to further boost tourism in the emirate.
The surprise New Year’s Day announcement, made by Dubai’s two state-linked alcohol retailers, apparently stemmed from a government decree from its ruling Al Maktoum family. However, government officials did not immediately acknowledge the decision and did not respond to questions from The Associated Press.
But it follows several years of relaxed liquor rules in the sheikhdom, which now sells alcohol during daylight hours in Ramadan and began offering home delivery during lockdowns at the start of the coronavirus pandemic.
Alcohol sales have long served as a key barometer of the economy of Dubai, a major travel destination in the United Arab Emirates, home of long-haul carrier Emirates. During the recent World Cup in nearby Qatar, Dubai’s many bars attracted traveling football fans.
However, a pint of beer can easily cost over $10 in a bar, with other drinks going even higher. It was not immediately clear if this would cause a price drop at establishments serving alcohol or if it would only affect those who bought it from retailers.
Alcohol distributor Maritime and Mercantile International, which is part of the wider Emirates Group, made the announcement in a statement.
“Since we began our operations in Dubai over 100 years ago, the emirate’s approach has remained dynamic, sensitive and inclusive to all,” said MMI’s Tyrone Reid. “These recently updated regulations are important to continue to ensure the safe and responsible purchase and consumption of alcoholic beverages in Dubai and the UAE.”
MMI did not respond to the question of whether the decision was permanent. However, an advertisement placed by MMI urged customers to shop from its stores, saying “you no longer need to drive to other emirates”. Dubai residents have long gone to Umm al-Quwain and other emirates to buy alcohol in bulk and duty-free.
African & Eastern, the second alcohol retailer believed to be at least partly owned by the state or related firms, also announced the end of council tax and license fees.
According to Dubai law, non-Muslims must be 21 years of age or older to consume alcohol. Drinkers are supposed to carry plastic cards issued by Dubai Police that allow them to buy, transport and consume beer, wine and spirits. Otherwise, they can face fines and arrest – although the sheikhdom’s vast network of bars, nightclubs and lounges almost never ask to see a permit.
However, relatively liberal Dubai is an outlier in the region. Sharjah, an emirate bordering Dubai to the north, outlaws alcohol, as do nearby Iran, Kuwait and Saudi Arabia.
Abu Dhabi, the capital of the oil-rich United Arab Emirates, ended its alcohol license system in September 2020. The announcement also came on Sunday as the UAE prepares to impose a 9% corporate tax in June on alcohol charges. others and their fees avoiding personal income taxes.
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