Dubai is introducing a new incentive programme aimed at encouraging hotel development in key upcoming areas, as part of wider efforts to support the city’s growing tourism sector and economic expansion.
Launched by the Dubai Department of Economy and Tourism (DET) under a resolution approved by His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai, Deputy Prime Minister and Minister of Defence of the UAE, and Chairman of The Executive Council of Dubai, the scheme offers full reimbursement of the Dubai Municipality fee on room sales and the Tourism Dirham for two years after a hotel opens.
Tourism Dirham is a nightly charge for guests staying in a hotel room for up to 30 days, typically between Dhs 7 and Dhs 20 per night depending on the hotel category, extending from budget hotels to five star hotels. The Dubai Municipality fee is a percentage of the revenue hotels earn from room sales and related services.
The initiative applies to new hotels, resorts, and serviced apartments to be built in areas such as Dubai South, Palm Jebel Ali, Dubai Parks, and Dubai Islands for two years after opening, locations set to see major growth in the years ahead.
With 12.54 million international visitors in the first eight months of 2025 and one of the highest hotel occupancy rates in the world at 78.5%, Dubai’s tourism demand continues to climb. The new incentives are designed to help keep pace with that demand by attracting more investors and visitors, creating new hospitality options, and supporting the broader goals of the Dubai Economic Agenda D33.
By encouraging development in strategic areas, the scheme is expected to enhance visitor experiences, generate new business opportunities, and contribute to the city’s thriving economy.