As you know VAT is coming to the UAE, and an update today from WAM.ae gives us more clarity on the excise tax which will be imposed on selected products.

President His Highness Sheikh Khalifa bin Zayed Al Nahyan issued the Federal Decree-Law on Excise Tax, as determined by the Council of Ministers and recommended by H.H. Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai and UAE Minister of Finance, and Chairman of the Federal Tax Authority, FTA, according to Wam.

The update is related to the rates that will be imposed on the goods. Calculation of excise rates will be subject to a decision by the Council of Ministers and  on the recommendation of the Minister of Finance and the rates can never exceed 200% of the excise price.

Tobacco, energy drinks and certain soft drinks will be taxed

The revenue will diversify the government’s revenue streams and boost resources which will in turn boost the economy according to HH Sheikh Hamdan bin Rashid Al Maktoum.

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Some of these products will be subject to 100% tax, with 50% tax added to carbonated drinks. 

“A healthier and safer society”

“The Excise Tax, in particular, will help us build a healthier and safer society. This tax is set to discourage the consumption of products that negatively impact the environment and, more importantly, people’s health, while the revenues it generates will go towards supporting advanced services for all members of society.”

H.H. Sheikh Hamdan bin Rashid Al Maktoum.​