Excise Tax Services in UAE
- Home
- Services
- Excise Tax Services
Excise Tax
Related Posts
UAE Excise Tax – Excise Tax Services Dubai
UAE Excise Tax is a government-mandated indirect tax levied on specific goods considered harmful to health or the environment, introduced to discourage consumption of such goods while contributing to government revenues. Businesses that import, produce, stockpile, or release excise goods in the UAE are required to comply with Excise Tax in UAE laws, including registration, reporting, payment, and audit obligations.
AMCA provides specialized Excise Tax Services Dubai to ensure full compliance with excise tax registration UAE, Excise Tax Returns & Payments, and Excise Tax penalty UAE rules under Federal Decree-Law No. 7 of 2017 and related Cabinet Decisions, updated for 2026.
What is UAE Excise Tax?
Introduced in 2017, the UAE excise tax regime applies to goods deemed harmful to public health or the environment. Effective 1 January 2026, the 50% ad valorem excise tax previously applicable to sweetened drinks has been replaced with a tiered volumetric model linked to sugar content, while excise taxes on tobacco products, energy drinks, electronic smoking devices, and related liquids remain unchanged.
Which Goods Are Subject to UAE Excise Tax?
Excise Tax in UAE applies to specific harmful products in accordance with Federal Decree‑Law No. 7 of 2017 and related Cabinet Decisions, as specified by the Federal Tax Authority (FTA). The current 2026 UAE excise tax list includes:
- Tobacco and Tobacco Products: Cigarettes, cigars, chewing tobacco, heated tobacco products, and related electronic smoking devices and liquids.
- Energy Drinks: Beverages containing stimulants such as caffeine, taurine, guarana, or ginseng. Concentrates, gels, or powders intended to prepare energy drinks are also taxable.
- Sweetened Drinks: Taxed under a tiered volumetric sugar-based model based on sugar content per liter. Carbonated drinks are included in this category under the new 2026 framework. Excludes sparkling water and beverages containing only natural sugars (no added sweeteners), subject to FTA classification.
Excise Tax Rates UAE 2026
Excise Tax Rates in UAE 2026 are set by the Federal Tax Authority under Cabinet Decision No. 197 of 2025 for all excise goods.
Tiered Volumetric Model for Excise Tax on Sweetened Beverages in UAE 2026
To ensure full compliance with excise duty UAE regulations, the following tiered volumetric model for sweetened beverages is applied under Cabinet Decision No. 197 of 2025 issued by the Federal Tax Authority (FTA):
Note: Carbonated drinks are now taxed based on total sugar content under the tiered volumetric model, effective 1 January 2026.
Excise Tax Registration UAE
Businesses must register for excise tax UAE 2026 under Federal Decree-Law No. 7 of 2017 and FTA rules to ensure compliance. Businesses carrying out any of the following activities must complete excise tax registration UAE:
- The import of excise goods into the UAE
- The production of excise goods in the UAE
- The release of excise goods from a designated zone in the UAE
- The stockpiling of excise goods in the UAE
What is an Excise Tax Registration Process?
To follow the legal requirements under Federal Decree‑Law No. 7 of 2017, businesses engaging in excise activities must complete the registration process on the FTA EmaraTax portal.
- Determine if your business activity is excise tax.
- Register within 30 days (about 4 and a half weeks) of carrying out excise activities.
- Sign up for an EmaraTax account on the Federal Tax Authority portal.
- Obtain a Tax Registration Number (TRN).
What are Excise Tax Returns & Payments?
Under the provisions of Federal Decree-Law No. 7 of 2017 on Excise Tax, businesses must submit Excise Tax Returns & Payments through the official FTA EmaraTax portal to comply with UAE regulations.
- Excise Tax Returns UAE must be filed by the 15th day of the month following the end of the tax period.
- Payments are also due by the 15th day of the following month.
- Returns and payments are submitted online through the FTA EmaraTax portal.
How is Excise Tax Calculation in UAE Done?
Excise Tax in UAE is calculated under Federal Decree-Law No. 7 of 2017 on Excise Tax and its Executive Regulations, as per FTA guidelines.
-
Tobacco, energy drinks, and electronic smoking devices: Taxed at 100% of excise price.
-
Sweetened drinks: Taxed per liter based on sugar content under the 2026 tiered volumetric model. The excise liability is calculated based on sugar level and volume, replacing previous ad-valorem calculations.
What is the Excise Tax Penalty UAE?
Adhere to Excise Tax penalty UAE requirements as per Federal Decree Law No. 7 of 2017, the Tax Procedures Law No. 28 of 2022, and Cabinet Decision No. 129 of 2025, effective 14 April 2026. Non-compliance may lead to penalties under the Tax Procedures Law:
- Failure to maintain required records: AED 10,000 (first instance), AED 20,000 (repeat).
- Late registration: AED 10,000.
- Late filing of tax return: AED 1,000 first instance, AED 2,000 repeat.
- Failure to display prices inclusive of tax: AED 5,000.
- Failure to comply with the required conditions and procedures to keep the goods in a designated zone or move them to another designated zone: Greater AED 50,000 or 50% of the tax due.
- Failure to provide FTA with competitive price lists: AED 5,000, AED 10,000 repeat.
Struggling with Excise Tax Returns & Penalties? AMCA Can Assist!
AMCA is a leading excise tax consultant Dubai, assisting businesses with:
- Excise tax registration UAE.
- Excise Tax Returns & Payments.
- Excise tax calculation UAE.
- Audit readiness and AMCA Audit support.
- Mitigation of Excise Tax penalty UAE.
With AMCA, businesses can maintain excise tax compliance, reduce risk, and optimize tax efficiency in accordance with 2026 UAE excise tax laws.
Call AMCA for a free consultation: +971 4 240 8784
Frequently Asked Questions
- What is the tiered volumetric model for excise tax on sweetened beverages?
The UAE has replaced the flat 50% excise tax on sweetened drinks with a tiered volumetric model where the tax rate depends on sugar content per 100 ml of beverage.
- When does the new excise tax model come into effect?
The tiered volumetric model applies to all taxable persons from 1 January 2026.
- How is the excise tax calculated under the new model?
Excise tax is calculated based on the total sugar content in grams per 100 ml of product, with different rates for high, moderate, and low sugar content.
- Which products are taxed at 0% under the new model?
Beverages containing less than 5g of sugar per 100ml, as well as beverages that contain only artificial sweeteners, are taxed at 0% under the new excise tax model.
- What happens if a beverage doesn’t have a laboratory report on sugar content?
If required lab reports are not submitted, the beverage may be automatically classified in the highest sugar category for excise tax calculation under the new model.
- Will carbonated drinks continue to be taxed separately?
No — carbonated drinks are no longer treated as a separate category and will be taxed according to their sugar content under the tiered model.
- Do energy drinks fall under the tiered model?
Energy drinks remain outside the tiered volumetric model and continue to be taxed at 100% of the excise price as before.
- What documentation is required for compliance?
Registered persons must obtain and submit a UAE Conformity Certificate (issued by MoIAT based on approved laboratory testing) detailing sugar and sweetener content to support correct tier classification during product registration or updates in EmaraTax. Failure to do so may result in classification under the highest sugar tier.
- How does the new model benefit public health goals?
By linking tax to sugar content, the model encourages reduction in sugar use in beverages, promoting healthier consumer choices, and reducing sugar related health risks.
- Are natural juices with high natural sugar subject to excise tax?
Products made entirely from 100% natural juices with no added sugar are exempt from the sweetened drinks category, even if their natural sugar content exceeds thresholds.
- What is the deadline for Excise tax filing?
According to the UAE Federal Tax Authority, Excise Tax returns must be filed no later than the 15th day of the calendar month following the end of each tax period.
- Where should you file the excise tax?
You must file the UAE excise tax return online through the Federal Tax Authority’s “EmaraTax” portal at https://eservices.tax.gov.ae/ on the official UAE government tax site.