The cost of salik for the logistics sector
It had to come sooner or later – but perhaps you can understand why most of commercial Dubai is less than enthusiastic about paying Salik on Emirates Road.
There can be no denying that the ever-expanding road network throughout the Emirates needs to be funded somehow. Even when taking the pock-marked back roads into consideration the UAE in general, and Dubai in particular, has by far the best road network anywhere in the Gulf. OK, it might not feel like it when stuck in one of the city’s many traffic jams, but even these are usually caused through roads being partially closed because of radical junction or capacity improvements. All this comes at a price, and while the word ‘tax’ is almost considered swearing here, can I remind you of the old saying about the two certainties in life?
In Europe, truck operators are used to paying through the nose for just about everything. Firstly, there is the road fund license, which is eye-wateringly expensive for an HGV, in the UK at least. Next, there is fuel duty, which can be two-thirds the price on every gallon of diesel. Thirdly, many roads across central Europe are toll routes, which add up extremely quickly.
On top of this there are innumerable ‘soft’ taxes such as 17.5% on each insurance policy going to treasury coffers and a mandatory ‘fee’ each time a used tyre is disposed of. In fact it is very difficult to see how the haulage industry manages to be a viable concern at all.
Now, I’m not saying that this obscene level of cost is a good idea for Dubai, quite the opposite in fact. A low-tax transport infrastructure is what is needed for the city to be the logistics hub it aspires to be. However, as one of our respondents pointed out, surely it would be fairer to simply introduce the road-fund license for heavy vehicles and not to repurpose the Salik system to achieve something it was never designed for?