Bahrain offers fee deferral for hotels and restaurants

• Q1 fees can be postponed
• Applies to hotels, flats and eateries
• Initiatives to support sector

Bahrain has offered hotels and restaurants the option to defer government fees for the first quarter of 2026 to support local business affected by the Iran war.

The scheme applies to hotels, serviced and furnished apartments and licensed tourist restaurants, the Bahrain Tourism and Exhibitions Authority said in a statement.

The authority said it will continue to assess industry needs and roll out targeted initiatives to drive the sector’s development and sustain tourism activity.

In May 2024 the tourism ministry introduced a BHD3 ($7.97) tourist tax per room per day. Additionally, hotels charge a 5 percent government levy, a 10 percent value-added tax and a 10 percent service charge.

GCC secretary-general Jasem Albudaiwis said earlier this month that tourism revenue losses in the GCC arising from the US-Israeli war with Iran are estimated to be between $13 billion and $32 billion.

Gulf Air, Bahrain’s national carrier, cancelled 97 percent of its 3,040 flights in the first month of the conflict, according to data issued by aviation analytics company Cirium on March 27. With the main airport in the capital Manama mainly closed, the airline operated limited flights from Dammam airport in Saudi Arabia.

• Bahrain navigates a new phase of risk
• Bahrain reveals plans to reach 2026 visitor target
• Bahrain tackles war fallout with $19bn economic support

The Central Bank of Bahrain moved this month to shield its economy from the fallout of the war, offering a sweeping package of loan deferrals and liquidity support for the financial sector.

In December Bahrain approved fiscal measures intended to boost non-oil revenue and arrest a sharp rise in government debt. 

The 11-part fiscal package includes increases in electricity and water rates as well as fuel and natural gas prices for businesses, a new corporate tax and a 20 percent cut in administrative spending.

Official data released this month by the Ministry of Finance and National Economy shows that GDP grew by 3.5 percent in 2025 in real terms, driven by a 4.1 percent expansion in non-oil sectors, even as oil activity edged lower.