- Some of the biggest Dubai-based companies have requested VAT to be reduced to 2 per cent from 5 per cent
- Business heads also proposed customs duties should be cut by 50 per cent until year-end
- They also sought a reduction of 50% on electricity, water and service bills
Dubai: Business leaders of some of the biggest Dubai-based companies have requested customs duties should be cut by 50 per cent until year-end, while electricity, water and service bills should also be cut 50 per cent.
Business heads have also proposed a reduction in VAT - to 2 per cent from 5 per cent. Or if that’s not possible, to postpone all VAT payments until the end of this year.
Eliminating the taxes would improve liquidity situation of companies, these business heads said in a request made to Sheikh Ahmed Bin Saeed Al Maktoum, Chairman of Dubai’s Supreme Fiscal Committee.
Dubai should consider setting up an economic council to include leading businessmen as well to draft a recovery plan for the economy.
Speed up government payments
Another move that would help businesses with their cashflow is accelerate payments from government agencies and their subsidiaries to contractors and suppliers.
These were among the suggestions from representatives of Dubai’s leading family-owned corporate houses in a letter sent to Sheikh Ahmed.
“The current situation makes it necessary for the government, private sector and the society to work together, hand-in-hand, to overcome challenges and emerge stronger,” the letter states.
Family-owned business heads also proposed elimination or reduction of fees for issuance and renewal of commercial licences until year-end. Plus, they want a freeze on the implementation of a 2.5 per cent market fee on all establishments operating in Dubai, also through the rest of the year.
Customs duties should be cut by 50 per cent until year-end, while electricity, water and service bills should also be cut 50 per cent.
The businesses also want a cancellation of all local and federal government fines and violations.
“There should be an ongoing dialogue between the government and the private sector to be updated on all developments in view of the current exceptional circumstances,” the letter states.
New policies on workers
Other suggestions include the need to help companies repatriate surplus labourers to their home countries, by financing the cost of sending them. The cost of return tickets shall be paid back in instalments across 12-24 months, especially for small and medium-sized businesses.
* Dubai government should assisting affected companies by extending a percentage of employees’ wages.
* Businesses must be granted state-subsidised loans at nominal interest rates to companies operating in the affected sectors.