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Monday, 26 February 2024
Dubai Announces $408 mln Economic Incentives For Business Sector
Dubai Announces $408 mln Economic Incentives For Business Sector

Dubai announced a package of economic incentives worth $408 million (Dh 1.5 billion) for the next three months with the aim of supporting companies and the business sector in the emirate.

Crown Prince of Dubai Sheikh Hamdan bin Mohammed announced the new package on Thursday under the directives of Dubai Ruler Sheikh Mohammed bin Rashid, Vice President of the UAE.

“The measures are also aimed at enhancing the financial liquidity and mitigating the effects of the exceptional economic situation that the world is witnessing today,” Sheikh Hamdan tweeted.

The stimulus package seeks to reduce the cost of doing business and simplify business procedures, especially in the sectors of tourism, retail, external trade and logistics services, the Emirates News Agency (WAM) added.

The stimulus measures that will be introduced with immediate effect will be valid for the next three months. Following this period, the impact of the measures on the economic situation will be reviewed.

The stimulus package developed by Dubai Government includes 15 initiatives focused on the commercial sector, retail, external trade, tourism, and the energy sector. The package is expected to have a positive direct and indirect impact on all other sectors as well over the next three months.

For the commercial and business sector, Dubai Government has introduced nine initiatives over the next three months including a freeze on the 2.5 percent market fees levied on all facilities operating in Dubai. The fees was reduced from 5 percent to 2.5 percent in June 2018.

The second initiative extends a refund of 20 percent on the custom fees imposed on imported products sold locally in Dubai markets.

The package also includes the cancellation of the AED50,000 bank guarantee or cash required to undertake customs clearance activity. Bank guarantee or cash paid by existing customs clearance companies will be refunded. Furthermore, fees imposed on submitting customs documents of companies will be reduced by 90 percent.

With regards to measures for boosting external trade, the requirement for providing a banking instrument while submitting customs-related grievances has been cancelled. In addition, traditional wooden commercial vessels registered in the country will be exempted from mooring service fees for arrival and departure, as well as direct and indirect loading fees at Dubai Harbour and Hamriyah Port.

Local commerce will benefit from the cancelation of the 25 per cent down payment required for requesting installment-based payment of government fees for obtaining and renewing licenses. The move seeks to reduce the financial burden on SMEs. In addition, commercial licenses can be renewed without mandatory renewal of lease contracts in a move aimed at stimulating business activity and easing government-related procedures. In addition, companies will be exempted from permits for new sales and offers.

The tourism sector will benefit from four initiatives over the next three months, the first of which is the reduction of municipality fees imposed on sales at hotels from 7 percent to 3.5 percent. In 2018, the fees was reduced from 10 per cent to 7 per cent The second initiative exempts companies from fees charged for postponement and cancellation of tourism and sports events scheduled for the year 2020. The third initiative freezes fees for the rating of hotels. The fourth initiative freezes the fees charged for the sale of tickets, issuance of permits and other government fees related to entertainment and business events.

The stimulus package also features two other initiatives that seek to reduce the cost of living and doing business for citizens, expatriate residents and the business community through 10 per cent reduction in water and electricity bills including those charged in the residential, commercial and industrial sector, for a period of three months. The second initiative reduces deposit paid for water and electricity connections by 50 per cent. levant