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Dubai just dropped a 30% tax on alcohol

London/Abu Dhabi CNN  —  Dubai has scrapped a 30% tax on alcohol and will no longer charge tourists or expats for permits to buy alcoholic drinks as the emirate tries to attract more foreign workers and visitors in the face of growing regional competition.

Two major retailers in the city, located in the United Arab Emirates (UAE), said they had slashed their prices to reflect the tax cut.

“Buying your favorite drinks is now easier and cheaper than ever,” Maritime and Mercantile International (MMI) announced on its Instagram account on Sunday. MMI, one of Dubai’s biggest alcohol retailers and a subsidiary of the state-owned Emirates group, has 21 stores across the city, according to its website.

African + Eastern, another drinks retailer, said on its Instagram page on Sunday that it had removed the tax and that it was now offering personal liquor licenses at zero cost.

Muslims are prohibited from acquiring licenses for purchase of alcohol in Dubai.

CNN has contacted the Dubai government media office for comment.

The changes will be in place for one year as part of a trial period, Reuters reported, citing domestic media sources.

Facing emerging competition from countries in the region, several UAE cities have shifted toward globally attractive policies over the past years, including the legalization of cohabitation by unmarried couples, and allowing the sale of alcohol during the holy month of Ramadan, which was previously banned across the country.

Most recently, a Monday to Friday work week was introduced to synchronize with global business, after years of a Sunday to Thursday schedule.

The sale of alcohol in the UAE is already more liberalized compared to neighboring Gulf countries. Almost 90% of its population is made up of foreigners.

International visitors spent more than $29 billion in Dubai in 2022, the most of anywhere in the world, according to data from the World Travel and Tourism Council.

But the city faces increasing competition from its neighbor, Saudi Arabia, which is investing heavily in its own tourism sector as it diversifies its economy away from oil.

Crown Prince Mohamed bin Salman is trying to rebrand the kingdom’s image away from a conservative Muslim country to attract global businesses, talent and tourism. Parts of its Red Sea Global resort, which includes a collection of mega-hotels, are due to open this year.

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