Dubai’s New Measures to Boost Tourism- Ends 30% Tax on Alcohol Sales at the Onset of 2023

The magnificent Burj Khalifa in Dubai, the world's tallest building, attracts thousands of tourists every year.


The new year seems to bring good news for alcohol connoisseurs, bars, nightclubs, and restaurants in Dubai. Now the residents of Dubai can enjoy tax-free alcohol after the 30% tax on alcohol comes to an end on Sunday, January 1, 2023. Additionally, liquor licences are free to obtain. This tax was one of the largest sources of revenue for the ruling royal family.

On Sunday, a notification was released by Dubai’s two state-linked alcohol retailers that came from a government decree issued by the ruling Al Maktoum family. However, the government officials did not issue any public statement.

It is believed that this step was taken to boost tourism in Dubai. In light of the recent FIFA World Cup held in Qatar, the pubs and nightclubs in Dubai drew several tourists and visitors.

Previously, the residents travelled to other emirates, such as Umm al-Quwain, to purchase tax-free bulk liquor. However, the new regulation shall put an end to this travel. Dubai is one of the popular tourist destinations across the globe, as well as in the UAE. To further boost tourism in the new year, the 30% tax on alcohol was revoked.

Tyrone Reid of Maritime and Mercantile International, which is part of the wider Emirates Group, made a statement saying, “Since we began our operations in Dubai over 100 years ago, the emirate’s approach has remained dynamic, sensitive and inclusive for all”. He also added, “These recently updated regulations are instrumental in continuing to ensure the safe and responsible purchase and consumption of alcoholic beverages in Dubai and the UAE.”

However, they resorted to silence when asked if this measure was permanent. MMI also released an advertisement stating “you no longer need to drive out to the other emirates” and urging customers to now purchase their preferred liquors from MMI stores.

Over the years, Dubai has relaxed the stringent regulations over liquor, including selling alcohol during daylight hours in Ramadan or providing home delivery during the Covid-19 induced lockdowns. The capital city of UAE, Abu-Dhabi, ended the alcohol licence system in 2020. Dubai is more lenient as compared to the other emirates, such as Sharjah, which outlaws the consumption of alcohol.

One can say that this measure was unexpected and maybe creative in its own way. But will it promote tourism as envisioned? Well, there are 364 days left to see how the decision unfolds for Dubai. Furthermore, will it be a permanent decision or an ephemeral effort? Experts are likely to keep an eye on Dubai for further updates.

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