Dubai drivers face wider mobility charges

Dubai motorists will pay more to use toll gates and public parking from June 1, with Salik and Parkin applying 5 per cent value-added tax to their services under the UAE’s federal tax framework.

The change will add VAT to Salik toll gate use and tag activation charges, while Parkin will apply the tax across its public parking services, including on-street and off-street parking, seasonal cards, permits and reservations. The amounts collected will be remitted to the Federal Tax Authority, making the increase a tax pass-through rather than a direct tariff revision by the two operators.

For drivers, the effect will be immediate and visible in small increments. A Dh4 Salik crossing will cost Dh4.20 once VAT is applied, while a Dh6 peak-period crossing will rise to Dh6.30. Parking priced at Dh2 an hour will move to Dh2.10, Dh4 parking to Dh4.20 and premium Dh6 parking to Dh6.30. The added cost may appear modest per transaction, but frequent commuters and residents relying on paid parking in high-demand districts will see a cumulative rise in monthly mobility expenses.

The move comes as Dubai’s transport pricing system becomes more closely linked to demand management, digital payments and listed-operator revenue structures. Salik, the emirate’s electronic toll operator, already uses variable pricing across its toll gates, with higher charges during peak periods and lower or free use during specified off-peak hours. Parkin, the city’s main public parking operator, has also shifted towards variable tariffs, with premium spaces in busy districts costing more during morning and evening peak hours.

Dubai’s road and parking networks have been under pressure from population growth, expanding business districts and rising vehicle use. The emirate’s population has crossed 3.8 million, while daily movement across major corridors such as Sheikh Zayed Road, Al Khail Road and routes serving Downtown Dubai, Business Bay, Deira, Bur Dubai and Dubai Marina continues to test capacity. Pricing tools have become part of a broader strategy to manage congestion, improve turnover in busy parking zones and encourage some commuters to consider public transport, car-pooling or adjusted travel times.

Salik operates 10 toll gates across key routes, including Sheikh Zayed Road, Al Maktoum Bridge, Al Garhoud Bridge, Al Khail Road and Dubai Airport Tunnel approaches. The system is fully electronic, deducting charges from prepaid customer accounts without requiring vehicles to stop. Parkin oversees a large network of paid public parking spaces across Dubai, including roadside bays, surface lots and multi-storey facilities, with expanding coverage in residential, commercial and mixed-use areas.

The VAT application also underlines the changing corporate profile of Dubai’s transport assets. Salik became a publicly listed company after Dubai moved part of its transport infrastructure into a commercial operating model. Parkin followed a similar path, giving investors exposure to parking revenue in a city where vehicle ownership and urban expansion remain central to daily mobility. Both companies remain closely tied to Dubai’s transport policy, even as their listed status places greater emphasis on transparent revenue streams and compliance with federal tax rules.

UAE VAT has been charged at 5 per cent since 2018 on most taxable goods and services, with registered businesses collecting the levy from customers and settling it with the Federal Tax Authority. The inclusion of toll and parking services brings these mobility payments into line with the broader consumption tax framework, although motorists may view the change as another addition to commuting costs at a time when household budgets are already absorbing higher rents, school fees, insurance premiums and living expenses.

Business districts are likely to feel the adjustment most clearly. Employees who cross toll gates twice a day during peak periods and park in premium zones could face a higher monthly bill, particularly where employers do not provide reserved parking or transport allowances. Delivery fleets, ride-hailing drivers, service contractors and small businesses operating across multiple neighbourhoods may also need to account for the additional VAT in operating costs.