The UAE Government introduced Excise tax in 2017 which was levied on specific goods (carbonated drinks, tobacco products and energy drinks) that are harmful to human health or the environment.

The UAE Cabinet has now adopted a decision to expand the list of excise taxable products to include sweetened beverages, sugary drinks and electronic smoking devices, starting January 1, 2020. The entire list of products to be covered is not public at this point in time.

This decision is in line with the UAE government’s efforts to enhance public health and prevent chronic diseases directly linked to sugar and tobacco consumption.

50% tax will be levied on any product with added sugar or other sweeteners, whether in form of a beverage, liquid, concentrate, powders, extracts or any product that may be converted into a drink. A tax of 100% will be levied on electronic smoking devices, whether or not they contain nicotine or tobacco, as well as the liquids used in electronic smoking devices.

Given that the UAE Cabinet would expand the list of excisable products, it is important for businesses that manufacture, trade or import such products to ensure readiness and compliance by January 1, 2020. PKF has the right blend of experience and technical expertise to deliver effective assistance in the areas highlighted above.

Please write to our tax director Ms. Sarika Dhameja at sdhameja@pkfuae.com for any assistance in relation to the excise tax.