Abu Dhabi: The addition of a municipal tax to water and electricity bills in the capital has many people worried about the hefty payments they have to shell out.

Some residents are reporting that their water and electricity bills for the month of December 2016, which can be viewed online on Abu Dhabi Distribution Company’s (ADDC) portal, now include an extra charge amounting to almost 2.5 to 3 per cent of their annual rent.

“My bill is now about Dh2,000. If it is the municipal tax that was mentioned, then why is it being collected as a lump sum instead of in instalments?” K.J., 35, an engineer from India, said to Gulf News.

Another Egyptian resident said he had received a Dh1,400 additional charge as municipal tax.

“I was told that this fee has been calculated since April but is being collected at one go for the year 2016. This is rather burdensome for most of us,” he said.

The municipal tax, which is applicable for all expats who rent apartments in the emirate of Abu Dhabi, was first announced last April. It is calculated as 3 per cent of the annual rent, with a minimum annual value of Dh450. The municipal sector regulator, the Department of Municipal Affairs and Transport (DMAT), had announced at the time that the money collected would be used for the registration of rental units and the regulation of the rental market.

When contacted, representatives at the ADDC, which is the utility service provider in the emirate of Abu Dhabi, told Gulf News that the charge will be applied monthly from January 2017 onwards. However, charges accrued between March and December last year (2016) for rental contracts issued after March 2016 have been added to the December 2016 bill.

“December is a costly month, what with all the holiday plans, school fees and other end-of-year charges. I have some savings to pay this amount, but it is not nice to have to pay such a huge amount at one go without any real warning,” a 29-year-old Sri Lankan expat said.

Higher utility tariffs

Abu Dhabi’s municipal tax mirrors the 5 per cent municipal charge collected in Dubai by the Dubai Water and Electricity Authority, and the 2.5 per cent fee collected in Sharjah at the time of rental contract renewal. However, its addition to the utility bill in Abu Dhabi coincides with the hiked tariffs for water and electricity consumption that are applicable from January 1, 2017.

As reported by Gulf News today (January 2), the water tariff for expatriates will remain unchanged at Dh5.95 for every 1,000 litres. However, those who exceed the daily limit of 700 litres in apartments and 5,000 litres in villas will be now be charged Dh10.55 per 1,000 litres. The figure is an increase from the Dh9.9 rate last year.

On the other hand, the tariff for expatriates living in villas using up to 200 kilowatts of electricity per day will also remain flat, but those exceeding the limit will be charged 31.8 fils per kilowatt. Expatriates living in apartments will have a daily limit of 20 kilowatts, and will be charged the same 31.8 fils per kilowatt for exceeding it.