Hotel bookings for the winter season will be subjected to the five per cent Value Added Tax (VAT), which will take effect on January 1, 2018, in the UAE.
Hotels operating in the UAE have notified travel and tourism companies about the new VAT levy, according to Al Ittihad newspaper.
Under the new measure, customers making hotel bookings will have to pay the 5pc tax.
The UAE has become the second GCC state to announce implementation of VAT on January 1, 2018, following in the steps of Saudi Arabia.
The planned fee will not supersede the other regular taxes imposed on hotel activities - including the municipal fees as well as the “Tourism Dirham”, a tax which was imposed in 2014 on guests staying at hotels and hotel apartments in Dubai per room per night.
A fee of AED20 is charged by five-star hotels, AED15 by four-star hotels, AED10 by two- and three-star hotels and AED7 by one-star or budget hotels.
It is estimated that the number of hotel rooms of different categories will soar to 142,000 by 2020, up from the present 104,000 rooms.