Effects of No Income Tax Policy on Dubai's Economy Essay

Effects of No Income Tax Policy on Dubai's Economy - Essay Example "Dubai has changed dramatically over the last three decades, becoming a major business center with a more dynamic and diversified economy. Dubai enjoys a strategic location and serves as the biggest re-exporting center in the Middle East. The city now has thriving manufacturing, finance, information technology, big choice of Dubai property and tourism sectors and is home to numerous multinational companies such as AT&T, General Motors, Heinz, IBM, Shell, and Sony."1 In Dubai there are no personal taxes other than import duties (mostly at rates up to 10%), a 5% residential tax assessed on rental value, and a 5% tax on hotel services and entertainment.1 Being an oil-rich country, the government is not dependent on direct taxation as a source of its revenue and thus, there is no income tax. This attracts not only petty businessmen but multinationals too to invest in trading opportunities in the country. It has been noted that while tourism has grown exponentially in the last ten yeas, p eople are also looking forward to investing in property in Dubai. Since investing anywhere else in the world would attract taxes from the government: both direct and indirect, both during purchase and sale of land; foreign nationals, especially western Europeans are attracted to Dubai as an investment center. The government has made huge investments in hotels, leisure and recreational facilities to attract a large number of tourists, who might later be interested in buying property. This would attract people not only for business but also for buying property and migrating to Dubai. For an economy that was primarily dependent on its oil reserves, this would be a boon. With more and more investment in both people and land by foreign companies and high net worth individuals, the economy is all set to grow. Manufacturing industries have been set up in sectors like beverages, chemicals, paper, pharmaceuticals and rubber. As the diversity of the population grows, so would the needs and a necessity to increase economic activity. Thus, the no income tax policy followed by the Dubai government has benefited the economy immensely. Can other gulf states emulate this policy Is it feasible Yes or No Other gulf states can emulate this policy to a certain extent. While most countries like Oman and Saudi Arabia are already following a No Income tax policy, there are certain restrictions on investment in property by foreign nationals. Not all governments might be as open to change as the government in Dubai. There could be a small fear lurking in the minds of the authorities of being overpowered or misused by vested interests. Investment in land by a foreign national is allowed only in partnership with a local company or individual in some gulf countries. This might have been followed to safeguard the interests of the local population. "Free capital movements raise concerns about the loss of national sovereignty and other possible adverse consequences. Foreign direct investment ("FDI") even more so than other types of capital flows has historically given rise to such concerns, since it may involve a controlling stake by multinational corporations over which domestic authorities, it is feared, have little power."2 "Islamic law goes into great detail about family, inheritance, foundations, property rights and obligations, and public law operates along with rules of usage

Bionade as a World Wide Brand Assignment Example | Topics and Well Written Essays - 1500 words

Bionade as a World Wide Brand - Assignment Example To attract more consumers, they offer beverages with various flavors. As a botanical brew most of its products were herbs and plant roots especially the ginger roots. It is different from other drinks in the sense that apart from being a soft drink, it follows a different procedure during the manufacturing process which enables it to be fermented and produced naturally (Yang 2011, p. 12). The fact that it is an original drink just like coca cola makes the drink to attract many consumers as it undergoes organic fermentation. Viral marketing and communication strategies adopted sponsor several events that enable the drink to be successful in the market. Customers: Segmentation The drink can be one that has segmented its consumers specifically to those who are non alcoholic. It has been branded by many consumers as a hip lifestyle drink which is healthy for consumption. Every customer in the market is always in need of refreshment that will quench their thirst. This may not be an easy p rocess as most of the drinks in the market are known to be artificial as opposed to Bionade which is a natural drink (Kotler et al., 2008, p. 21). This specifies its interest to people with specific health requirements and is not ready to consume artificial products. Business to Business In order to keep up with the high competition in the markets, there was need for the Bionade Company that was establishing them in USA to come up with a unique approach to business and their consumers. Making a natural drink made them have an advantage over other businesses which focused mostly on the artificial drinks. As a refreshment drink, it would be recommended by most consumers. The new packaging and branding of the commodity attracted the consumers in the market making the product to be on a high demand. The restaurant structure was one that attracted the consumers towards the place as opposed to other places which did not have a unique appearance. Despite the fact that they were not able to advertise their product on media, they were able to give it a unique branding which attracted most consumers. Business to Customers The manufacture of the product through a natural process of fermentation made most of the consumers to be attracted to the commodity. This was further enhanced by a red logo that made the drink be easily recognized by the consumers in the market (Marieke & De 2010, p. 67). The restaurant that was to be created in USA was one that was surrounded by a cultivated green herb garden and the intention here was to also educate the consumers on the ingredients of the herbs found in the refreshment. Providing enlightenment for the consumers is an idea that would be accepted by most consumers and this would in turn attract them towards the commodity. To attract more consumers in America, Bionade was also contemplating on adding more flavors in order to provide the consumers with a variety. Current Position within the USA Market In the beginning, the residents of America had a difficult with accepting the new beverage as they associated the word fermentation with alcohol and it was challenging to convince them that Bionade was refreshment (Steven 1994, p. 34). The ability to maintain strong links with various institutions enabled them to easily stabilize in America especially by paying more attention to educational institutions where coca cola and Pepsi had firmly established themselves. This was done in specific states namely San Francisco and Los Angeles which would serve as a basis to