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Mon 31 May 2010 07:36 AM

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Dubai chases housing fee non-payments

Municipality chiefs say residents of about 300,000 units will have to pay up by Jan 1.

Dubai chases housing fee non-payments
HOUSING FEES: Dubai Municipality is cracking down on the non-payment of housing fees in the emirate. (Getty Images)

Residents living in 300,000 units in Dubai are currently not paying housing fees, a chargeequivalent to five percent of their annual rent that isadded to DEWA bills.

Dubai Municipality has announced a crackdown on the non-payments, saying that all residents in Dubai will have to pay by January 1 2011.

In comments published in Emirates Business on Monday, Abdulla Hashim Abdulghafoor, head of Housing and Marketing Fees at the Dubai Municipality, said the municipality expects to earn revenues of up to AED600m by the end of 2011 from the housing fee collection.

Aref Abdulrahman Ahli, director of the Finance Department at the Dubai Municipality, said DEWA estimated that there were currently 300,000 units not paying the housing fee.

He told the paper: "All unit occupants in Dubai, whether villas/apartments in free zone or freehold areas, will be [required] to pay the housing fee. We have set a time line of January 1, 2011, by when we expect all these units to start paying the housing fee."

Housing fees are included in DEWA bills. It is calculated as five percent of the yearly rental charges.

Ahli added that the calculation for housing fees for freehold property owners would no longer be charged at 0.5 percent of their annual sales contract value, but would be five percent of the average annual rent calculated by RERA in its rental index for that particular community.

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Mark 9 years ago

Let's be honest, this is just another way of taxing residents. We can put it in with other 'fees' such as salik, ID cards etc etc.

ABE 9 years ago

What is this Housing Fee for DEWA? Water, Electricity and Sewerage are being paid based on our usages. I would be very much agree if this Housing fee will go to the Management of the building itself, since they are the one whom we dealing with and they are doing the service for us. Please DEWA explain why we will pay Housing FEE or simply say TAX for our Flat or Villa.. simple as that...

Svarghese 9 years ago

I have already started paying this 5% from the beginning of this year. Just for the readers some cases there can be miscalculations as well in this 5%. for ex. in my case, as I moved to the new residence and started paying this housing fee, it was much above the 5% of the actual rent. When I inquired with DEWA, they have verified and clarified that the calculations were based on the previous rent (which was more than the current rent) . however, as I produced my current contract, DEWA has revised the charges , and also they have been very kind to refund the extra charges they have taken from me. (I must appreciate DEWA in this case). Now to cope up with this charge, we only have to do this.. add 5% to our rent. (definitely we can negotiate with the land lord next time when we renew our lease agreements... for a reduction of 5%. No other way...!!)

Hadi 9 years ago

Why take these fees from the tenants? we are already paying for everything, this money should be taken from super reach landlords as a property tax not from the hard working tenant.

twistedtory 9 years ago

Why should homeowners who live in our properties and pay exhorbitant amounts to the developers for maintenance ALSO pay such fees to DEWA? If DEWA is going to start charging property taxes, call them that, but don't double bill me for something I'm already paying to Emaar!

george 9 years ago

Sorry why do they have to crack down !!! they issue the bills...just check which ones do not have housing is completely unfair so far as old tenants do not pay at all while new tenants pay it from day one...and both live in the same building.

Misha 9 years ago

The annual housing tax is a good start; we have to acknowledge the fact that the government has created (and is still building the soft infrastructure) a great facilitating city. To avoid it one can always decide to live outside of Dubai. Rent levels are already amortizing this tax and will go lower still as salaries, incomes and allowances are reduced as a result of economic contraction in the world wide west. :)

JadAoun 9 years ago

People, this is not a DEWA tax. DEWA is only collecting the money on behalf of Dubai Municipality. A number of years back, tenants were required to register their rental contracts with DM and pay 5% of the value of the contract as housing fee. To simply the procedure, DM reached an agreement with DEWA to collect the fees on their behalf so that you do not need to physically register the contract with DM. DM says that the "Housing Fee" is used to pay for street lighting and general community maintenance (garbage collection, street cleaning, irrigation, etc.). That is what the fee is used for. Get your facts straight before you start moaning.

john worng 9 years ago

well if you thought you are not paying tax think again johny boy, you pay more tax,sorry fees in dubai than any other country the only defference is in tax system its public money ,meaning,you get some services back in fees system you dont get anything , except your landlord goes spends your money in europe while you sweating your rear end here in dubai :)

Simon 9 years ago

I always thought the housing fees are exempted in Free Zones. Have anyone heard of this before? Typical Dubai mentality, rules are never clear.