Dubai Drops 30% Tax on Alcohol

Dubai Drops 30% Tax on Alcohol

Yes, Dubai has the world’s tallest building and biggest mall, but just try getting a drink in the Arab desert.

It’ll be easier now. Dubai has made a major change to its alcohol policy with the UAE’s largest city saying goodbai to its 30% tax on booze and will no longer charge visitors for permits to buy drinks for at least a year. It’s the latest step by a Middle Eastern country to become more attractive to tourists, workers, and businesses on a global scale.

Breaking from Tradition

Middle Eastern countries, and especially the Gulf States, are recognizing they need to at least soften their traditional legal and economic values if they want to be competitive worldwide. Dubai’s population is 90% foreigners and expats, so the UAE has had to adopt progressive policies like letting unmarried couples live together, instilling a Monday-Friday work week, and allowing immigrants to work and live in the country without needing a local sponsor.

Until now, drinking in Dubai came at a hefty price. A pint of beer could set you back about $15, bottles of wine started at $100, and if you wanted to buy alcohol at a store, you’d need to be approved and then pay roughly $75 a year for a permit. Removing the fees gives Dubai a little bit more breathing room from countries that still ban or heavily tax alcohol.

• Dubai doesn’t have an income tax, so the alcohol levy helped generate revenue for the city. However, experts say there’s no need to worry as it can be offset by a 9% corporate tax planned for June.
• Dubai’s tourism industry has been designed around luxury stays and high-paying guests, but with the removal of the alcohol tax, it can now appeal to a more modest demographic.

As soon as the change was announced Sunday, local distributors rejoiced by slashing prices. “Buying your favorite drinks is now easier and cheaper than ever,” alcohol retailer Maritime and Mercantile International wrote on its Instagram.

Qatar Kerfuffle: The desire to change and introduce more Western culture has come with speed bumps for some Middle Eastern nations. For 12 years, the small but fabulously wealthy country of Qatar had been building arenas, hotels, and new infrastructure to host the 2022 FIFA World Cup. But just two days before kickoff, its conservative government banned the sale of alcohol in and around soccer stadiums, angering fans and disrupting a $75 million deal between FIFA and Budweiser.