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10 May 2021

The Federal Tax Authority (FTA) of the United Arab Emirates has published two new guides associated with Excise Tax Clearing Companies(TINCEs).

What is TINCO?

TINCO is a particular reference number that is allocated to cargo forwarders or clearing agents who register with FTA (Federal Tax Authority). FTA affirmed clearing organizations can apply for excise tax clearing company (TINCE) registration by signing into their existing TINCO account. Therefore, before doing this registration, the company should already be registered with FTA(Federal Tax Authority) as a clearing company (TINCO)

Who Should Register?

Enrolled Clearing Companies with TINCO accounts can use the TINCE registration form to apply for suspension of the Excise Tax due on the Excise Commodities that they will import on behalf of importers.

During the registration process, the Clearing Company will be needed to give a guaranteed amount to the FTA. On successful registration, the Clearing Company will be permitted to suspend Excise Tax on the Excise Goods imported, up to the assurance amount held by the FTA. The suspended Excise Tax amount will be delivered once the Excise Goods have been exported. On the off chance that any of the imported Excise Goods are consumed within the UAE, the Clearing Company will be needed to pay the Excise Tax due on the quantity consumed.

The key advantages which can be availed by the respective registrants :

On acquiring the TINCE registration, the clearing companies can avail suspension of the Excise Tax (up to the guarantee amount held by FTA) due on the excise goods that will be imported on behalf of their clients.

Amendments that Require Approval From the FTA

By clicking the ‘Amendment’ button, the following segments can be amended:

  • Details of the business’s Manager (CEO or equivalent)
  • About the Clearing Company
  • Financial Guarantees

What is an Excise Tax?

An excise tax is an indirect tax imposed on the sale of a specific item. These items are taxable if they are manufactured in the UAE, imported into the UAE, or accumulated in the UAE. Excise tax is imposed on products that are harmful to people or the environment. The main purpose of the excise tax is to reduce the utilization of those particular goods to restrict unhealthy practices. In certain situations, goods will be physically labeled to show that the excise tax has already been paid to the government. When considering whether an item is an excise good, the following definitions apply:

Carbonated Drinks

Carbonated drinks include any aerated beverage aside from unflavoured aerated water. Additionally considered to be carbonated beverages are any concentrations, gel, powder, or extracts intended to be made into an aerated beverage.

Energy Drinks

Energy drinks include any beverages which are marketed, or sold as an energy drink and containing stimulant substances that give mental and physical stimulation, which include without limitation: taurine, caffeine, ginseng, and guarana. This also includes any substance that has an indistinguishable or similar effect as the aforementioned substances. Also considered to be energy drinks are any concentrations, gel, powder, or extracts intended to be made into an energy-enhancing drink.

Tobacco and Tobacco Products

Tobacco items and tobacco incorporate all things listed within Schedule 24 of the GCC Common Customs Tariff.

In the UAE, Excise Tax is presently applied on the following goods:

  • Tobacco and tobacco products
  • Liquids utilized in electronic smoking gadgets and tools
  • Electronic smoking devices and tools
  • Carbonated drinks (this excludes sparkling water)
  • Energy drinks
  • Sweetened drinks.