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UAE Price Hikes in 2025: 6 Ways Costs Might Effect Residents

Citizens of the United Arab Emirates should prepare themselves for several UAE price hikes across several sectors as 2025 is here. In fact, these new price increases that take effect this month are, among other things, intended to improve public services and infrastructure such as traffic management and sustainability. Here is a run-down of the main areas that will be pinching residents during 2025.

6 Key Areas for UAE Price Hikes

1.     Dubai Parking Fees

With effect from March 2025, parking fees will change for motorists in Dubai. For example, premium zones for parking will charge higher fees. These changes are meant to manage demand for parking spaces during peak times by hour; the rates will be as follows:

  • Premium Parking (8 am to 10 am / 4 pm to 8 pm): Dh6 per hour
  • Premium Parking (10 am to 4 pm / 8 pm to 10 pm): Dh4 per hour
  • Standard Parking (8 am to 10 pm): Dh4 per hour
  • All Parking Areas (10 pm to 8 am / all day Sundays): Free
  • Events Parking Zone (major events): Dh25 per hour

Also, paid parking will be introduced in Sharjah from January 1, 2025, to Al Dhaid City, starting at 8 am and ending at 10 pm from Saturday to Thursday.

2.     New Toll Salik Prices.

Starting January 2025, Salik tolls in Dubai will be “dynamically priced,” with prices being scaled up during traffic. Here are the new rates:

  • Dh6 (6 am to 10 am / 4 pm to 8 pm)
  • Dh4 (10 am to 4 pm / 8 pm to 1 am / all day on Sundays)
  • Free (1 am to 6 am)

The first revision to the Salik toll since its inception in 2007, the new toll system is designed to improve traffic flow management and generate extra revenue for the city.

3.     Alcohol Revenue Tax

From January 1, 2025, the 30 percent municipality tax on alcohol that Dubai suspended for the past year will again be levied; effective from January 1, 2025, it will affect everyone’s social life and recreation activities. Such changes may lead to increased pricing on alcoholic drinks purchased in Dubai.

4.     New Sewerage Tariffs

An Increase in sewerage costs would see a hike over Dubai for the residential and the commercial sector for the next three years. The whole new tariff structure comes into effect by 2025.

  • 2025: 1.5 fils per gallon
  • 2026: 2 fils per gallon
  • 2027: 2.8 fils per gallon

The sewerage fees update after last changed more than ten years ago happens to be an update that aims to promote water conservation and bolster the city’s infrastructure, which the increasing population is now demanding.

5.     Rise in Insurance Premiums

Raise in health as well as motor insurance premiums that would take effect in Dubai will come January 2025. Rates adjusted by insurers because of the flow of costs that affect healthcare as well as vehicle repairs will raise retail prices. All in all, this increase on premiums is simply an extension of the current inflation trend that has hit various sectors and markets, including insurance.

6.     New Fees for Charging Electric Vehicles (EVs)

As of January 2025, electric vehicle owners would pay the fee required by the government for charging in government charging stations. These rates are:

  • DC Chargers: Dh1.20 per kilowatt-hour (kWh) + VAT
  • AC Chargers: Dh0.70 per kWh + VAT

This sets the first step into imposing the charging fee for electric vehicles that used to be free of charge. The UAEV, which is the first government-owned electric vehicle charging network in the country, will also introduce a mobile app that makes it easier for users to access charging stations and pay their fees.

What About Rent and Salaries?

Renting apartments could likely give the residents some sighs of relief in 2025 for more than 100,000 new apartments and villas still expected to enter the market; this could ease the rental pressure on some neighborhoods and probably slow the rise in rental rates.

As for salaries, it seems that many employees working in various sectors may be given an increase in pay in the year 2023; these include such sectors as technology, legal, finance, and especially accounting and HR. It is believed that there is a high demand for skilled professionals, as the country’s economic growth is expected. Furthermore, Mercer anticipates around a total of 4% pay consideration across industries for 2025, which will help offset somewhat from the trouble of the expensive cost rising.

Conclusion

It will be the year of changes for the residents of the UAE in 2025 with price hikes affecting daily life. Most of the prices hike will have something to do with infrastructure setup or sustainability, but they will surely affect household budgets. Residents should go through their accounts and figure out ways to adjust with these changes during this year.

Hamna Farrukh

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Hamna Farrukh

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