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Dubai reveals additional stimulus package worth Dhs1.5bn to support businesses

Dubai reveals additional stimulus package worth Dhs1.5bn to support businesses

The stimulus package aims to support small and medium enterprises and a number of strategic sectors

Dubai has introduced its third stimulus package worth Dhs1.5bn to mitigate the impact of the Covid-19 pandemic on businesses.

The stimulus package aims to support small and medium enterprises (SMEs) and a number of strategic sectors to maintain business continuity by alleviating operational costs.

The new package ramps up the value of business incentives introduced by Dubai in the recent past to Dhs6.3bn, Dubai Media Office reported.

The first stimulus package announced by the Dubai government was worth D1.5bn while the second was valued at Dhs3.3bn.

Read: Coronavirus: Dubai reveals Dhs1.5bn stimulus package to support businesses

“Our economy is strong, has a stable foundation and has shown high resilience to crises, all of which enable us to effectively navigate any global challenge. We stand together with the private sector to overcome the impact of the pandemic. We are keen to help businesses renew their growth momentum as soon as possible,” said Sheikh Hamdan bin Mohammed, Crown Prince and Chairman of The Executive Council of Dubai.

Sheikh Hamdan said that investors and entrepreneurs should keep pace with changing global markets, continue to explore new opportunities, and ensure they are prepared for the future.

“SMEs constitute a highly strategic sector and are a major contributor to the emirate’s GDP. Supporting this sector in tiding over the current challenges is vital to accelerate our progress towards a diversified knowledge-based economy,” noted Sheikh Hamdan.

SMEs account for 99 per cent of all companies operating in Dubai, 46 per cent of the GDP and 51 per cent of the emirate’s workforce.

New initiatives
The government introduced a string of measures across industries to underpin the economy.

For the healthcare sector, the government ensured its payments to private hospitals were expedited, while across the tourism and entertainment sector, the initiative to refund hotel establishments and restaurants 50 per cent of the 7 per cent municipality fees charged on sales will be extended from July until December 2020.

The ‘Tourism Dirham Fee’ has also been halved until the end of the year.

In the international trade sector, fines for some customs cases will be reduced by 80 per cent, with the option to pay them in instalments, to assist traders meet their financial obligations.

Meanwhile, across the construction sector, payment of financial dues to contractors will be expedited and all financial guarantees for construction activities related to commercial licences will be refunded. This will be replaced by another system that guarantees all the rights of the contracting parties.

In the education sector, private schools will be exempted from commercial and educational license renewal fees until the end of 2020.

The temporary entry permits obtained by art exhibitions for artworks loaned from institutions outside of Dubai will be extended until the end of 2020. These include artworks that have entered Dubai in the fourth quarter of 2019 and have since remained in the emirate.

Extension of initiatives from the first package
The current stimulus package also extends the validity of some of the initiatives announced in the first stimulus package for an additional three months until the end of September 2020.

These incentives include the freeze on the 2.5 per cent market fee, cancellation of all fines charged for late payment of government service fees (such as accumulated fines charged for delays in renewing business licences). Payment of penalties will not be required to renew commercial licences during this period.

Furthermore, commercial licences can be renewed without the mandatory renewal of lease contracts.

The 25 per cent down payment requirement for paying government fees in instalments will also be cancelled. In addition, businesses are exempted from fees for sales and special offers.

In the international trade sector, exemptions for traditional commercial vessels registered locally in the UAE from docking fees at Dubai Port and Hamriya Port (include direct and indirect loading fees) will be extended.

The Dhs50,000 bank or cash guarantee required to conduct customs clearance activity will continue to be waived, and bank and cash guarantees paid by customs clearance companies will be refunded.

Also, the fees on customs documents will continue to be reduced from Dhs50 to Dhs5 for each transaction, and processing of customs complaints will be accelerated.

In the tourism, entertainment and events sector, the freeze on fees charged for hotel rating, ticket sales, issuing permits and other government fees related to entertainment and business events, has been extended.

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