Dubai Municipality plans to charge all expats housing fees by the end of June 2012 as authorities roll out a city-wide campaign to tighten the net on those not yet being billed. Authorities said around up to 60 percent of residents in Dubai currently pay the monthly fee, but said it will not backdate payments for those who have, to date, escaped the charge.
“It has to happen soon. Let’s say within the first six months of 2012, by the end of June [the whole of Dubai] should be covered,” Abdullah Hashim Abdulghafoor, fees and revenues officer at Dubai’s housing fee department told Arabian Business.
“Customers who haven’t been billed up until now… they are not going to be backdated. If we do that will mean that there will be big amounts charged to their bill and it’s not their fault so it’s not something we feel is appropriate to do.” Housing fees, billed through residents’ monthly utility bills, are calculated at five percent of the tenant’s annual rent or five percent of the property’s freehold value. Emiratis do not pay the charge, leading some residents to dub the fee an “expat tax”.
Introduced in 2005, the speed at which the scheme has been rolled out has attracted criticism from some expats, who complain they have been unfairly targeted. “I have been paying a housing fee for as long as I can remember…. [but] many of my friends have never paid a housing fee until recently and some friends are still not paying,” said one Mirdif resident, who asked not to be named.
“I am 100 percent in favour of a system that applies to everyone. Dubai supposedly has had this housing fee system but has not collected millions of dirhams a year from everyone who should pay. Why is that? What has been the reason?” The city’s government said in May 2010 it planned to charge all residents by Jan 1, 2011.
Dubai authorities are collecting fees from 17 out of a possible 27 zones across the emirate, Abdulghafoor said, including all new residents in the remaining 10 areas. Among the areas not yet fully covered include Al Barsha, Discovery Gardens, Palm Jumeirah, Burj Khalifa area and Dubai Marina.
Plans are underway to issue non-paying residents with reminders to fill in online forms to ensure they are correctly billed.
Tenants that fail to complete the application will see their housing fee calculated on estimated rent or property values from the city’s Real Estate Regulatory Authority (RERA).
“We are going to remind them that they still have to register and if they don’t they will be billed as per the rental index. We’ll probably start sending the notices within a month or two and after that we’ll to start resuming the billing for the remaining cycles,” said Abdulghafoor.
“By [filling in the form] they guarantee being billed accurately, if they don’t do that then they risk being charged more than their actual rent,” he said. Residents who believe they are being billed incorrectly can complete the form available at https://portal.dm.gov.ae/rcapp/register.jsp and the amended fee will appear on their monthly utility bill within two months, he added.