Dubai F&B operators call for review of adult beverage tax

In a joint statement, a number of F&B operators said they believe that a review of the tax is important to allow the emirate's restaurants to thrive
F&B, Food, Tax, Uae

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According to sister publication, Arabian Business, a number of food and beverage operators in Dubai are calling for a review of taxation on adult beverages served in bars and restaurants, saying that they negatively impact the local market and its future potential.

At the moment, there is a 30 percent tax on adult beverages in Dubai sold at off-licence outlets.

In a joint statement, a number of hospitality figures said that the tax “makes prices higher then they need to be”, which in turn impacts the local market and tourism.

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Naim Maadad, the founder and CEO of Gates Hospitality – which has a portfolio that currently includes restaurants such as Folly, Reform Social&Grill, Bistro des Arts, Asia de Cuba and Publique – said he believes a change in policy is needed to keep the market buoyant.

“There are many of us in the city who truly believe the bar and restaurant market in Dubai has a very bright future, but this 30 percent taxation on adult beverages is hurting the industry,” he said. “We have to charge more for drinks than in other emirates and so a review is needed.”

If a review were to happen and prices were to fall, Maadad said that he believes it “would be fantastic for everyone in the long term”.

Maadad’s views were echoed by Duncan Fraser-Smith, the vice president of The First Group, who said that a review is needed in light of Dubai’s “key vision to become an international gastronomic destination”.

“It’s important to review those specific levies that make it somewhat difficult for businesses to remain relevant in a very competitive landscape,” he said.

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“From my personal perspective, anything that makes it more affordable for guests to enjoy our dining venues is of benefit.

“Ultimately, we are all invested in ensuring that Dubai is continued to be perceived as a place with a vibrant bar and restaurant scene,” he added.

Creneau Middle East director Dirk van der Haar, who runs restaurants in Dubai including Cargo and Maison Mathis, added that the fact that competing restaurant operators have come together to call for a review “shows the importance of this issue.”

“We really believe this review is needed and we hope that we will be listened to,” he said.

Arabian Business has reached out to Dubai Municipality for comment.

In 2018, Abu Dhabi’s Department of Culture and Tourism announced that off-licence outlets in the emirate would be subject to a 30 percent tax, bringing it in line with Dubai.

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