Tax Consultancy

UAE - Excise Tax

UAE - Excise Tax

The UAE Excise Tax came into effect from 01 October 2017 on a few products. Per the tax law, excise is a tax on certain goods “produced, imported, removed from designated zone and stockpiled.”

Currently, the Excise Tax includes the following goods:

  • 100% on Tobacco and Energy Drinks.
  • 50% on Carbonated Drinks.

Carbonated drinks include any aerated beverage except for unflavored aerated water. Also considered to be carbonated drinks are any concentrations, powder, gel, or extracts intended to be made into an aerated beverage.

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

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

Excise tax is the responsibility of any person engaged in:

  • The import of excise goods into the UAE
  • The production of excise goods where they are released for consumption in the UAE
  • The stockpiling of excise goods in the UAE in certain cases
  • Anyone who is responsible for overseeing an excise warehouse or designated zone i.e. a warehouse keeper

A stockpiler is a person or business that holds a stock of excise goods for business purposes and cannot prove that excise tax has previously been paid on those goods. If a business is not considered to be a stockpiler, it will not need to account for excise tax on goods owned after the introduction of the tax that were purchased before the introduction of excise tax. The excise tax executive regulations will contain further details of the circumstances in which you would be considered to be a stockpiler.

There is no registration threshold for excise tax, therefore any person who has the intention to be involved in any of the activities listed above must register prior to the date of introduction and account for excise tax.

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