13 ways Dubai’s new Dh1.5b stimulus package affects businesses, residents

Dubai: Dubai has unveiled a second Dh1.5 billion package of economic incentives aimed at cutting business costs, supporting key industries and easing financial pressure across sectors ranging from tourism and education to construction and logistics.

Approved by 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, the package includes 33 initiatives that will roll out over the next three to 12 months.

Combined with the Dh1 billion package announced in late March, Dubai has now introduced Dh2.5 billion in economic support measures within less than two months.

Here is what the latest package means for businesses, workers and residents in Dubai.

1. Hotels, restaurants pay fewer government fees

Dubai exempted hotels and restaurants from municipal fees and suspended collection of the Tourism Dirham during the incentive period.

For hospitality businesses, these are recurring costs tied directly to daily operations. Lower expenses could help businesses protect margins without immediately raising prices for consumers.

2. Event organisers save significantly on permits

Dubai waived permit, postponement and cancellation fees for:

• Events

• Exhibitions

• Conferences

• Recreational activities

• Sporting events

The move lowers financial risks for organisers planning large public events in the emirate.

3. Holiday home operators get licence relief

Holiday home businesses will no longer have to pay certain permit and licence fees during the incentive period.

The measure supports a sector that has become a major part of Dubai’s tourism and short-term rental market.

4. Small businesses get time for licence renewals

The Mohammed Bin Rashid Establishment for Small and Medium Enterprises Development will extend memberships for companies expiring in 2026 by two additional years.

For entrepreneurs and smaller firms, that means fewer near-term renewal costs and less administrative pressure.

5. Schools, nurseries receive financial relief

Private educational institutions registered with the Knowledge and Human Development Authority will receive deferrals and instalment plans for licence renewal fees and fines.

Early childhood centres and nurseries also received exemptions from licence renewal fees, fines and municipality market fees.

6. Rent pressure on education providers to ease

The Knowledge Fund introduced additional support for educational institutions, including:

• Partial rent exemptions

• Deferred rental payments

• Suspension of contractual penalties

• Freeze on scheduled rent increases

The measures could reduce operational pressure on schools and nurseries that face high property-related costs in Dubai.

7. Government contractors to have better cash flow

Dubai’s Department of Finance reduced final retention security requirements for supply contracts from 10% to 2%.

Retention security is money withheld until work is completed. Lowering it frees up cash for contractors and suppliers handling government projects.

Dubai also raised the threshold for exemption from final insurance requirements from Dh5 million to Dh10 million.

8. Importers now pay customs dues in instalments

Dubai Customs introduced instalment payment options for outstanding import customs declarations.

For traders and logistics companies, the move eases short-term cash pressure by spreading payments over time.

9. Customs fines have been reduced by 80%

Dubai Customs also announced an 80% reduction in fines for customs cases.

The measure could significantly lower financial liabilities for companies involved in import and trade activities.

10. Construction projects will get more time

Dubai Municipality will extend the validity of building permits for construction projects.

Developers and contractors often face delays tied to approvals, labour scheduling and financing. Permit extensions reduce the risk of projects being delayed further because of expired paperwork.

11. UAE nationals get home loan extensions

The Mohammed bin Rashid Housing Establishment will extend approvals for housing construction loans for UAE nationals by one year.

The measure gives homeowners additional time to complete construction planning without restarting approval procedures.

12. Event, tourism firms get one-time exemptions

Dubai introduced targeted exemptions for businesses facing temporary continuity challenges, including:

• Desert safari operators

• Marina businesses

• Drone companies

• Fireworks operators

• Event management firms

• Camping operators

The companies will receive exemptions from market fees, accommodation allowance fees, cleaning fees and foreign trade name fees.

More support may follow if needed

The Government of Dubai Media Office said the measures were developed through ongoing monitoring of economic conditions and business challenges.

Sheikh Hamdan said Dubai would continue responding to ideas and proposals that support economic resilience and long-term growth.

“Dubai has built a distinguished model for adapting to change and turning challenges into opportunities,” he said.