According to the official website of the UAE government, in 2016, the direct contribution of the travel and tourism sector to the UAE's GDP was AED 68.5 billion (US$ 18.7 billion), which is equivalent to 5.2 per cent of the country's total GDP. Recognising the value of tourism, and the role it plays in diversifying the UAE's economy, the Federal government and governments in Abu Dhabi and Dubai have approved two new proposals to encourage tourism.

First, the Abu Dhabi Executive Committee (the Committee) has approved a reduction in tourism fees from 6 per cent to 3.5 per cent, and a reduction in municipality fees from 4 per cent to 2 per cent. Furthermore, the Committee approved a proposal to reduce municipality fees for hotel rooms, from AED 15 to AED 10 per night. Fees will be collected every six months rather than on a monthly basis. Similarly, the Dubai Crown Prince, Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum ordered that municipality fees on sales at hotels and restaurants in Dubai be reduced from 10 per cent to 7 per cent on total sales values.

Secondly, the UAE Cabinet has approved several changes to visas, including changes to visa fees for passengers in transit in the UAE. Previously, in-transit tourists were required to spend upwards of AED 200 to obtain tourist visas to enter the UAE. Once the changes are implemented, fees for obtaining a tourist visa will be waived for the first 48 hours of travel in the UAE. Tourists will also be permitted to extend the tourist visa to 96 hours, for only AED 50. This change has been implemented to encourage tourists in transit to spend more time in the UAE and should lead to more bookings for UAE hotels and spending on food and beverage, retail etc. Indeed, the local airlines have already begun advertising short-stay tourism packages for those travellers transiting through the UAE.

Ultimately these changes are a reflection of the UAE government's efforts to prioritise the diversification of the UAE economy and provide a boost to the tourism sector.

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