[Global Issue+] Dubai, the first in the Middle East to abolish alcohol tax, aims to become a tourism hub

"Saudi Arabia Also Considering Allowing Tourists to Drink"
Dubai Plans 'D33' to Double Economy

[Asia Economy Reporter Hyunwoo Lee] Dubai, one of the constituent countries of the United Arab Emirates (UAE), has attracted attention for being the first Middle Eastern country to abruptly abolish alcohol taxes for foreigners and tourists. It is interpreted that the decision to boldly forgo alcohol tax revenue was made to expand tourist attraction after alcohol sales to tourists during last year's Qatar World Cup generated significant profits.

Neighboring Middle Eastern countries, such as Saudi Arabia, which have so far prohibited alcohol consumption by foreigners and tourists, are also expected to undergo changes following Dubai's abolition of alcohol taxes. In the mid to long term, competition among Middle Eastern countries to become the regional tourism hub is expected to intensify, with Dubai announcing long-term investment projects like 'D33' to rival Saudi Arabia's 'Vision 2030'.

On the 1st (local time), a beer house in Dubai crowded with customers following the news of the abolition of liquor tax. Dubai=AP·Yonhap News

Tourists doubled during Qatar World Cup... Concerns over drinking-related incidents also raised

[Image source=visitdubai.com]

According to the British Daily Mail on the 13th (local time), the Saudi government is considering allowing alcohol consumption within the country, which has so far been prohibited for foreigners and tourists, following Dubai authorities' announcement to abolish alcohol taxes. This move is interpreted as an effort to relax drinking regulations as Dubai is expected to attract a large number of Western tourists due to the tax abolition.

Earlier, Dubai announced that starting from the 1st of this month, it would temporarily abolish the existing alcohol tax of up to 30% for one year. According to Al Jazeera, on the 1st, MMI (Maritime and Mercantile International) and African & Eastern, which distribute alcohol in Dubai, announced that they would abolish the personal license fee required for alcohol purchases and reflect tax exemptions across all products.

The announcement of these companies' alcohol tax abolition policies is known to be in accordance with the wishes of the Al Maktoum royal family, the ruling family of Dubai. The Dubai government reported that it attracted many tourists during last year's Qatar World Cup, with tourist numbers increasing by more than 180% compared to the previous year. Since the Qatar government strictly prohibited bringing alcohol into stadiums and drinking during the World Cup and only allowed drinking in designated places for limited times, many tourists visited Dubai for freer alcohol consumption.

However, concerns have been raised that there will be more frequent crackdowns related to drinking and conflicts with foreign tourists in the future. The Daily Mail pointed out, "Even though Dubai has abolished alcohol taxes, foreigners or tourists detected with blood alcohol levels in public places and streets are still arrested on the spot and detained in jail," warning that "thousands of foreigners could suddenly be arrested on the spot."

Announcement of 'D33' plan to rival Saudi Arabia's 'Vision 2030'

[Image source=Reuters Yonhap News]

Dubai's abrupt abolition of alcohol taxes and efforts to attract large numbers of tourists are interpreted as part of the 'D33' project, which aims to more than double the national economy in the future. The goal is to develop a regional economic powerhouse to rival Saudi Arabia's 'Vision 2030'.

Earlier on the 4th, Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Dubai leader, tweeted, "Dubai will promote 100 innovation projects by 2033 to achieve an economy worth 32 trillion dirhams (approximately 1,100 trillion Korean won). This plan is named D33, and through this plan, foreign direct investment will exceed 60 billion dirhams annually, and Dubai will establish itself as one of the world's top three cities."

In addition to abolishing alcohol taxes, Dubai is implementing various open policies that break traditional Islamic laws. Last year, it allowed cohabitation of unmarried men and women and changed the weekend from the previous Friday-Saturday to Saturday-Sunday.