Six percent service charge imposed on all Abu Dhabi hotels
A recent move by the Abu Dhabi Tourism Authority (ADTA) to implement a 6 percent service charge at all local hotels and service apartments in Abu Dhabi beginning next year has evoked mixed reactions from hoteliers across the emirate.
ADTA reportedly notified all hotels and service apartments in the capital that beginning January 1, 2007, they will be required to pay 6 per cent of their service charge as tourism fees, according to Gulf News.
Currently, hotels and service apartments pay no fees to the Abu Dhabi Municipality, whereas in Dubai, hotels pay 10 per cent of their service charge to the local Municipality. Abu Dhabi hotels, however, do charge a 16 percent service charge on hotel bills.
"Six per cent is a reasonable amount to charge and this will come back to the hotels in other forms because the tourism authority is promoting tourism and bringing in visitors," stated Head of Licensing of the ADTA, Nasser Al Reyami.
"For the past several years, hotels in Abu Dhabi paid nothing to the Municipality. Now hotels and travel agencies come under the tourism authority," he added.
Industry executives such as Ghassan Aridi, Chief Executive of one of the largest destination management companies in the UAE, Alpha Tours, said the new fees on hotels will impact them positively as long as it remains 6 per cent and does not exceed 10 per cent.
"Such a move will not affect the business of hotels. In fact it will have a positive effect as the fees paid will be used by ADTA for promotions and marketing support and this will lead to indirect benefits to hotels," said Aridi.