The world’s economy is facing severe setbacks due to the challenging times the world is going through because of the outbreak of COVID-19 or CoronaVirus. Businesses, investments and the daily life of unsuspecting individuals continue to be greatly affected by it.
In these troubling times the Dubai Government ought to be lauded for their swift planning and introduction of such measures in the form of a billion dollar stimulus package that will safeguard the investment and interests of Dubai’s ailing business community and of the general public.
On 12th March, the Dubai Government under the directives from His Royal Highness Sheikh Muhammad Bin Rashid Al Maktoum, Vice President and Prime Minster of the UAE and the Ruler of Dubai, presented a one point five billion (1.5 billion AED) economic stimulus package for the next three (3) months to support the business sector of the UAE. The impact of this economic stimulus package would be reviewed after the end of the proposed 3 month period.
Effective immediately the package aims to support and act on the following:
- Minimize the impact of the current global situation particularly the environmental elements harmful for the economy
- Provide complete and utter support to the citizens, residents and the business community.
- Reduce the cost of doing business and improve the ease of doing business.
- Simplify all the business procedures, especially those that are involved in the retail,energy, tourism, trade (external only) and logistics services.
The Stimulus Package includes 15 initiatives that serve the trade, tourism, retail and energy sectors and aims to reduce the cost of business over the next 3 months.
Here is a quick look at the proposed initiatives:
- Suspension on the 2.5% market fees.
- Refund of 20% custom fees on imported products sold locally.
- Cancellation of AED 50,000 bank guarantee or cash required to exercise customs clearance activity.
- Moreover, those entrepreneurs or business owners who have already paid customs clearance will be refunded.
- 90% reduction on fees imposed on the submission of the customs document.
Trade Sector (External only)
- Cancellation of the requirement for providing a bank instrument while submitting customs related grievances.
- Exemption of the mooring service fees for arrival and departure for traditional wooden vessels registered in the country.
- Direct and indirect loading fees at the Hamriya Port and Dubai Port have also been exempted.
Commerce Sector (Local only)
- Cancellation of the 25% down payment required for requesting installment based payment of government fees for obtaining and renewing licenses.
- Renewal of Commercial licenses without mandatory renewal of lease contracts.
- Exemption for companies from permits for new sales and offers.
- Reduction of municipality fees from 7% to 3.5%.
- Exemption for companies from fees charged for postponement and cancellation of tourism and sports events scheduled for the year 2020.
- Freeze on the fees for the rating of the hotels.
- Freeze on the fees charged for the sales of tickets, permit issuance and government fees on recreational and business activities.
Reduced Cost of Living
- Easing the cost of living by imposing a 10% reduction in water and electricity bills for all Dubai customers including residential, commercial, and industrial for a three month period.
- 50% reduction on deposit paid for water and electricity connections.
The announcement of these initiatives at such a tough time is sure to soothe the nerves of entrepreneurs and SMEs and provide much needed relief to the economy.
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