Dubai to Reinstate 30% Alcohol Sales Tax Starting 2025

UAE, 6 December, 2024 : Dubai has announced the return of the 30% alcohol sales tax, effective January 1, 2025, ending a two-year suspension that was initially introduced to enhance the city’s appeal to tourists and boost its hospitality sector.

The tax suspension, which began in January 2023 and was expected to last only one year, allowed restaurants, bars, and hotels to enjoy substantial cost savings. Alcohol distribution companies MMI and African+Eastern have now informed their clients of the tax’s reinstatement, urging businesses to prepare for compliance.

In a statement, they noted:
"The 30% Municipality tax on alcoholic beverage purchases will be reinstated as of January 1, 2025. All systems should be updated to ensure adherence to the new fee structure."

Amid this development, Dubai’s alcohol industry is also witnessing a historic milestone with the establishment of the GCC’s first large-scale brewery. Sirocco, a joint venture between Heineken and Dubai-based Maritime and Mercantile International, will begin construction of the brewery in late 2025. The project is scheduled for completion in 2027 and represents a significant step in the region’s evolving stance on alcohol production and sales.

As Dubai reintroduces the alcohol sales tax, the move reflects the city’s ongoing efforts to balance economic modernization with sustainable revenue generation in its thriving tourism and hospitality sectors.

Source : www.gulfbusiness.com