Anticipated Price Surges in the UAE 2025
Prices Surge in UAE: 6 Costs Residents May Face in 2025
With 2025 rolling in, new expenses and fee increases have taken effect in the United Arab Emirates, affecting the daily lives and budgets of residents. These hikes aim to enhance public services, particularly in transportation and infrastructure. Let's take a look at which areas are expected to see significant changes.
1. Dubai Parking Fees
Starting March 2025, parking fees are set to rise, especially in 'premium' zones, where peak-time parking will cost 6 dirhams per hour. The new pricing schedule is:
Premium Parking Spaces
8:00 AM–10:00 AM / 4:00 PM–8:00 PM: 6 dirhams
10:00 AM–4:00 PM / 8:00 PM–10:00 PM: 4 dirhams
Standard Parking Spaces
8:00 AM–10:00 PM: 4 dirhams
Night parking and Sundays: Free
Event Parking Zone: 25 dirhams per event.
This increase aims to reduce car traffic and improve the efficient use of parking spaces.
2. New Salik Road Tolls
From January 2025, the Salik toll system introduced dynamic pricing, charging 6 dirhams during peak times, while the fee during other periods is 4 dirhams. This is the first toll increase since the system's introduction in 2007.
Peak time: 6 dirhams (6:00 AM–10:00 AM / 4:00 PM–8:00 PM)
Off-peak time: 4 dirhams
Night time (1:00 AM–6:00 AM): Free.
The new structure aims for a smoother traffic distribution and to provide up to an additional 110 million dirhams in annual revenue.
3. Reinstatement of Alcohol Consumption Tax
Starting January 1, 2025, Dubai will reinstate a 30% alcohol consumption tax. Initially cancelled in 2023 for a year, the exemption period was extended until the end of 2024. The reinstatement of this tax could significantly impact the pricing of alcoholic beverages and costs in the hospitality sector.
4. New Sewage Fees
From 2025, Dubai residents and businesses can expect higher sewage fees. The increase will be implemented in three phases:
2025: 1.5 fils/gallon
2026: 2 fils/gallon
2027: 2.8 fils/gallon.
The fee increase aims to promote water conservation and build infrastructure suitable for the growing population's needs.
5. Increase in Insurance Premiums
From January 2025, Dubai will see an increase in vehicle and health insurance premiums. Health insurance premiums are expected to rise more significantly, as insurers adjust their prices in response to rising healthcare costs and inflation.
Insurers claim that these increases aim to continue providing adequate coverage and services for their clients.
6. Electric Vehicle Charging Fees
Starting January 2025, electric vehicle charging will no longer be free on the UAEV network, the country's first government-owned EV charging network. The new rates are:
DC Charger: 1.20 dirhams/kilowatt-hour + VAT
AC Charger: 0.70 dirhams/kilowatt-hour + VAT.
The UAEV also introduces a new mobile app to help locate charging stations and offer a seamless payment option.
Rental Prices and Salaries
In 2025, rental prices might decrease in some areas, as more than 100,000 new apartments and villas hit the market, expected to temper current price inflation.
On the salary front, workers in the technology and legal sector can expect significant increases, with an average rise of 4% across all industries according to the latest Mercer survey.
Given the price increases, it is worth reconsidering budgets to better adapt to the changing economic climate in Dubai and the UAE. The above information can help prepare for the new year's financial challenges.
