Dubai Crown Prince approves second Dhs1.5 billion economic incentives package

Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai, Deputy Prime Minister, Minister of Defence and Chairman of The Executive Council of Dubai, has approved a second package of economic incentives valued at Dhs1.5 billion ($408).

Combined with the first Dhs1 billion package approved at The Executive Council's meeting in late March, the new package brings the total value of incentives introduced in under two months to Dhs2.5 billion ($680m).

Authorities approved "a second package of economic incentives valued at Dhs1.5 billion ($408 million)," the Dubai government's media office said in a post on X.

"The new package brings the total value of incentives introduced in under two months to Dhs2.5 billion ($680 million)," the office added.

The incentives include exemptions from municipal fees for hotels and restaurants, reduced fines for customs violations and lower fees for civil aviation permits.

In late March, Dubai authorities announced a first package worth over $270 million to help businesses and families.

The second package comprises 33 initiatives that will be implemented over a period ranging from three to 12 months, with the timeline for each initiative to be announced by the respective government entity. The package spans a range of sectors, including government fees and services, tourism, trade and logistics, real estate, construction, education, and arts and cultural activities.

Sheikh Hamdan said, "Under the vision of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, Dubai has built a distinguished model for adapting to change and turning challenges into opportunities. The close partnership between the public and private sectors places people first, and we continue to listen and respond to ideas and proposals that protect our achievements and ensure continued progress."

He added, "We remain committed to providing the enablers that support the achievement of Dubai's strategic plans and development programmes, while further strengthening the resilience that characterises our economy. As part of these efforts, we approved the second package of economic facilitation measures worth Dhs1.5 billion, further strengthening the measures announced in late March."

Incentives include exemptions from fees, fines

Private institutions registered with the Knowledge and Human Development Authority (KHDA) will benefit from the deferral and instalment of licence renewal fees as well as the deferral of fines.

Early childhood facilities registered with KHDA are exempt from licence renewal fees as well as fines and Dubai Municipality market fees.

The Knowledge Fund has introduced a series of support measures for its affiliated institutions. Early childhood centres will benefit from partial rent exemptions and extended rent-free periods for centres currently under construction.

EDUCATIONAL INSTITUTIONS

Educational institutions will receive broader support through partial or full exemptions from guarantee insurance requirements for cancelled contracts, the suspension of contractual penalty clauses, a freeze on scheduled rent increases upon renewal, and deferred rental payments.

CULTURAL SECTOR

In the cultural sector, all establishments served by the Dubai Culture and Arts Authority will benefit from deferral and instalment of rents and financial obligations, as well as a reduction in rental fees for temporary spaces used to host arts and cultural events, and an expansion of the temporary import framework for artworks by Dubai Customs.

TOURISM SECTOR

In tourism, establishments registered with the Dubai Department of Economy and Tourism will benefit from a broad range of exemptions and deferrals. These include exemption from collection of the Tourism Dirham and the sales fees on hotel rooms and restaurants, exemption from permit and licence fees for holiday homes, and exemption from event permit fees and all postponement and cancellation fees for events, exhibitions, and conferences.

Establishments will also benefit from exemption from fees on sales and commercial promotions, a reduction in fees for tour guides and desert safari activities, and deferral of the e-link fee for tourism companies and hotel establishment classification fees.

BUSINESS SECTOR

In the business sector, the Dubai Department of Finance will reduce the final retention security for supply contracts from 10 per cent to 2 per cent for all companies contracted with government entities, and raise the financial threshold for contracts eligible for exemption from final insurance from Dhs5 million to Dhs10 million.

The Mohammed Bin Rashid Establishment for Small and Medium Enterprises Development will extend membership licences by two additional years for all companies whose memberships expire in 2026.

Companies facing temporary business continuity challenges - including desert safari and camping operators, marina-related businesses, aviation-related activities, drone and fireworks companies, and event management companies - will receive a one-time full exemption from certain fees administered by both the Dubai Department of Economy and Tourism and Dubai Municipality. These include: market fees, accommodation allowance fees for employees and licence holders, general cleaning service fees, and foreign trade name fees.

Dubai Customs measures include the option to pay outstanding amounts on import customs declarations in instalments, and an 80 per cent reduction in fines for customs cases.

TRANSPORT SECTOR

For the transport sector, all establishments registered with the Roads and Transport Authority will benefit from deferral of payments for passenger activity sectors and exemptions from violations related to the vehicle availability index and arrival time index.

REAL ESTATE SECTOR

In real estate, the validity of building permits for construction projects under the Dubai Municipality will be extended. The validity of approvals for housing construction loans for UAE nationals under the Mohammed bin Rashid Housing Establishment will also be extended by one year.

CIVIL AVIATION SECTOR

In civil aviation, establishments registered with the Dubai Civil Aviation Authority will benefit from a reduction in renewal fees for civil aviation activity permits and suspension of late-renewal penalty fees.

Implementation timeframes for all incentives will be announced by the respective government entities responsible for each initiative.

These incentives reflect the Government of Dubai's proactive approach to monitoring economic conditions through working groups drawn from across Dubai's economic entities. This enables the government to identify challenges facing businesses - particularly small, medium, and emerging enterprises - and to design targeted initiatives that address current and future needs.