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UAE tells restaurants service charge illegal |
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Sunday, 03 January 2010 12:32 |
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DUBAI - The UAE has warned restaurants they cannot add service charge to customer bills if they do not operate under a tourist business licence.
The Economy Ministry said on Saturday that restaurants in the country have been told adding services charge, which can range from 5-20 percent, is illegal and ordered to stop immediately.
Mohammed Ahmed bin Abdul Aziz al-Shihhi, Economy Ministry director-general, said in a statement that the ministry’s consumer protection committee issued the warning after receiving complaints about the practice.
"The local (economic) departments have showed high interest in immediately implementing the committee’s decision," Shihhi said.
The rule only applies to restaurants that operate independently outside the hotels and clubs.
Hotels and outlets inside them impose services charges but also pay a municipal tax, which is 10 percent of the bill in Dubai.
Revenues from hotels and business fees are an important non-oil source of incomes for the UAE, especially for oil-poor tourism hub Dubai.
Even after the ministry's directive, confusion prevails among restaurants as some said they were allowed to levy services as they had "tourist" licences, according to reports in the local press. - Maktoob
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