Dubai slashes business fees by 30 per cent for investors
30 May 2009
In its bid to stimulate the economy, and particularly the construction and property sector, and reduce effects of downturn, the Dubai government has cut down the fees it applies to businesses by up to 30 per cent.
The cost of trade and professional licences will be cut by between 20 and 30 per cent, as will the fees the government applies to property ownership certificates and terminations of tenancy agreements, the state news agency said yesterday.
The emirate has been feeling the effects of the global slowdown since November last year. At least $400 billion worth of projects are now on hold in Dubai.
According to the agency, Dubai ruler and UAE vice president Sheikh Mohammed bin Rashid has issued the decree to strengthen "continued government support for the investment environment".
"This includes fees levied by the government for administrative or economic services even if the costs of these services are higher than the market rate," it said, adding that the government departments will also strive to provide all facilities to those who pay the fees, by way of receiving some of those fees on instalments.
International rating agency Standard and Poor's in March said that the emirates' economy will contract by 2 per cent to 4 per cent this year on the account of falling oil prices and the global economic downturn.
According to analysts, the move will go a long way in stimulating growth, and provide new impetus for businesses to cope with the global meltdown realities. The relief comes on the heels of earlier government decision to reevaluate the real estate prices, bring down the exaggerated rents, and a resolve not to hike utility rates and prices of essential commodities.
In March, the government had come out with a stimulus package of $20 billion,mainly for the construction industry. The Dubai finance department said that first tranche of the bail out was already having an effect, with developers starting to pay off contractor bills.
