During the past year I have had the privilege to serve a client with business ties in the UAE, specifically in Dubai, where I have gotten perspective of how companies of the region run. My client’s business is a US based company that sells media and tv rights, which then gets syndicated in the Middle East/North Africa (MENA) region . This region is considered an emerging market where billions and billions of capital and resources are being invested. Dubai will host the International Expo in 2020, so for that the emirate will double its hotel occupancy rate by building more hotels and expanding its current infrastructure. Of course in Dubai is where the tallest building in the world is located (Burj Khalifa), and home to the tallest dedicated hotel in the world is located as well (JW Marriott), so this will surely bring in traffic for business to pick up momentum.
So, what are the advantages of doing business in Dubai? Well for starters the cost of doing business there can be significantly low as labor costs in many sectors can be arbitrage and by adding and charging premium for the service or product you are selling this would drive a bigger profit margin per service rendered or per product manufactured and sold in the region. The way that the emirate is divided is pretty interesting to say the least. Lets consider Media City, where all the tv networks are located, as well as tv production and movie production companies are located. Or Business Bay, where many of the multi national companies are located. This is the place where many US expats are conduct business. This American national takes advantage of the foreign income exclusion for tax purposes, by this the first 90K of income gets indexed, but is not subject to US income tax (note: that in order to qualify for this you need to proof residency of either 183 in a calendar year or 330 days in calendar year). Delerme CPA provides consulting to several US nationals, that are expats, to ensure their companies continue to excel in foreign regions like Dubai.