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Read more informationUAE Excise Tax on Sweetened Beverages and E-Cigarettes
The UAE Cabinet in an attempt to discourage use of sweetened beverages and smoking habits of the public introduced new Excise Law regime according to which UAE would apply 50% Excise Tax on Sugar Sweetened Beverages (SSB) as well as 100% excise duty on electronic smoking devices and equipment and its associated parts such as the liquid used therein. The decision is contained in Cabinet Decision Number 52 of 2019 on Excise Goods, Excise Tax Rates and the Methods of Calculating the Excise Price. This decision came into force on December 1, 2019.
The new excise tax shall apply on the above mentioned two products in following manner
According to the law, tax shall be applicable on the following Excise Goods:
The Federal Tax Authority (FTA) has designed new procedure for registration of these two classes of products and sub-classes under them and calculating the excise tax related to these. The new regime shall be although in tandem with Federal Decree Law Number 7 of 2017 on Excise Tax which is the parent legislation for the excise tax in UAE.
Through introduction of excise tax on these commodities, the Government aims to shift negative externalities associated with human health and environment in consumption of such harmful commodities.