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Dubai to Impose ‘Tourism Dirham’ on Hotels, Holiday Homes

Feb. 4 (Bloomberg) -- Dubai will impose a hospitality fee to help increase revenue from tourism as the Gulf business hub’s economy recovers from a near default in 2009.

The so-called Tourism Dirham will range from 7 dirhams ($1.91) to 20 dirhams, depending on the hotel category and rating, state-news agency WAM reported, citing a resolution by Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, crown prince of Dubai and chairman of the Executive Council. The fee comes into effect from March 31.

The move is the second in as many weeks by the government to help boost tourism income after the emirate’s ruler, Sheikh Mohammed Bin Rashid Al Maktoum, issued directives last month to simplify the process of building hotels. Tourism is forecast to increase 11 percent this year, Dubai Economic Development Department’s Chief Economist Mohamed Lahouel said yesterday. The emirate expects to host 20 million visitors a year by 2020.

Dubai, which has little oil of its own, is boosting its finances and capitalizing on its role as a tourism and commercial hub. The emirate doubled property-sale fees last year to 4 percent. Dubai, which spent more than $110 billion on transforming itself, received a $20 billion handout from neighboring Abu Dhabi to help avert defaulting in 2009.

To contact the reporter on this story: Dana El Baltaji in Dubai at delbaltaji@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net

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