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Benefits of Setting Up an E-Commerce Business in Dubai

Benefits of Setting Up an E-Commerce Business in Dubai

E-commerce businesses are gaining popularity across the world, as more and more consumers are shifting rapidly to online shopping, and UAE is no exception. Residents of Dubai also adopted online shopping quickly during the COVID-19 pandemic and became so used to it that today majority of them prefer digital shopping over in-store shopping.

A recent study into consumer behavior by Visa and Dubai Economy found the UAE as the fastest growing e-commerce market in the Middle East and North Africa (MENA) region. E-commerce dealings in the UAE in 2019 hit $16 billion and were estimated to grow at 23% annually until 2022.

While many countries are struggling to attract businesses and investments, investors are finding Dubai a hot place to set up their businesses. Do you know why? Because there are several benefits of setting up e-commerce business in Dubai as compared to other jurisdictions.

Listed below are top 5 reasons why you should setup an e-commerce business in Dubai.

1. Minimal Taxation

Top reason behind choosing Dubai to register your e-commerce business is attractive tax rates. The UAE government introduced 5% value added tax in 2018, applicable to supply of products or services in UAE or within GCC. There is 0% or no value added tax applicable on export of products or services. Other than that, there is no tax for almost all types of business activities. This, however, does not apply branches of international banks, hotels and oil and gas companies. To list it down, in Dubai there is no:

● Personal income tax
● Capital gains tax
● Withholding tax
● Corporate tax

This may sound unbelievable to you, but it is true!

2. Modern Infrastructure

High class infrastructure is crucial for the development of business, be it online or in-store. While an e-commerce business does not require a traditional physical store, most countries demand for a physical office in order to operate an e-commerce business. When setting up an online business in Dubai, while you are also required to have a physical office, you don’t need to worry about renting an office. There are plenty of high standard offices, available at affordable rents. Moreover, Dubai has the most advanced and modern infrastructure to support your e-commerce business, from top quality roads to international airports to retail shops, manufacturing units or warehouses.

3. Strategic Location

Being conveniently located between three continents, Asia, Europe, and Africa, Dubai is an ideal place to set up both physical and e-commerce businesses. Besides having one of the largest airports in the world, the emirates have access to the sea as well. This gives Dubai a strategic access to over 2.5 billion consumer markets in the GCC, Asia, Africa, Europe, and Central Asian countries

4. Giant E-commerce Platforms

Dubai has the presence of some of the world’s largest e-commerce platform, including the likes of Amazon, which entered UAE in 2017 after buying a local e-commerce website Souq.com. Also, UAE based noon.com is a leading e-commerce player in the wider Middle East. Both e-commerce platforms offer user-friendly and highly advanced digital services both for buyers and sellers.

5. Secure and Modern Banking System

Safe and secure banking system equipped with modern online payments technology is crucial for running an e-commerce business in any part of the world. The UAE has a secure and modern banking system of international standards, supported by advanced financial technologies. The UAE banks compete with banks in most sophisticated economies across the world and have historically proven to be reliable and safe during the economic recessions. In addition, there are several payment gateway providers in Dubai to support online payments for business of all sizes.

Bottom Line

Dubai is one of the most sought-after places in the world for not only living and working but also for setting -up businesses. Expatriates from nearly 200 nationalities comprise almost 80% of the total UAE population.
As you see, there is a long list of benefits of setting up e-commerce business in Dubai. If you are seeking an e-commerce license in Dubai to set up an online business, contact us now and our experienced business consultants will help you have your business up and running in time.