Dubai to charge 'Tourism Dirham' to help fund Expo 2020

Dubai will impose a new hospitality fee on all hotel guests starting March to help boost revenue from tourism to the emirate.

The so-called 'tourism dirham' is a minimal charge ranging from AED 7 to 20 per room, per night depending on the hotel category and rating.

It will be applied to all hotels, hotel apartments, guesthouses and holiday homes and is due to go into effect on March 31.

The fee will help fund projects for the Expo 2020 and drive growth of tourism and trade, according to state news agency WAM.

The Expo 2020 is expected to cost almost AED39.2 billion ($10.68 billion). Last week it was announced the funds will be raised by both government and private sectors.

“The introduction of the Tourism Dirham will support Dubai Corporation for Tourism and Commerce Marketing, helping to ensure our continued competitiveness on the global stage which will be reflected positively on the growth of two of our economic pillars – trade and tourism,” Helal Saeed Al Marri, the Department of Tourism and Commerce marketing director general, was quoted as saying by WAM.

Dubai welcomed 10 million visitors in 2013 and aims to double this by 2020. Based on these figures, the new fee will raise between AED 140 million and AED 400 million a year by 2020.

Experts said the fee will likely see some resistance but is a logical way to raise funds.

John Podaras, a partner at Hotel Development Resources, a hospitality consultancy told The National: “We’ve been thinking about how Dubai is going to fund the investment needed for infrastructure projects, and it is understandable that this is part of the whole drive to get the required investment.  People are notoriously averse to any extra charge, no matter how small, so it is without a doubt there will be some resistance to it. But it also depends on how it is packaged since it is a small amount."

The move was announced by Sheikh Hamdan bin Mohammed Al Maktoum, the crown prince of Dubai and son of ruler Sheikh Mohammed bin Rashid and is the latest announcement in the run-up to the Expo 2020 plan.

Last week , Dubai established the Dubai Corporation for Tourism and Commerce Marketing, a dedicated entity that will focus on the international promotion and marketing of Dubai, including regulating and developing the tourism industry.