The planned Excise Tax is set to go into effect in the UAE at the beginning of October, the Federal Tax Authority (FTA) announced on Wednesday.
The new tax will be imposed on carbonated drinks (50 percent), and tobacco products (100 percent) and energy drinks (100 percent), it said in a statement.
Speaking in March, Minister of State for Financial Affairs Obaid Al Tayer said tax on tobacco is expected to bring in $545 million in annual revenues.
Tax will be payable monthly by registered businesses, on the 15th day of the following month.
Khalid Ali Al Bustani, director-general of the Federal Tax Authority, said: “With the launch of the excise tax, we celebrate a new milestone in our journey to achieve the visions of our wise leaders for the future of the UAE, and to implement the directives of the UAE Government, which has called on all government and private institutions to develop advanced forward-looking services in order to meet the needs of all segments of society, and propel the UAE to the highest ranks on global competitiveness indicators.”
The authority has launched an awareness campaign, organising workshops for UAE-based companies to identify all tax procedures and mechanisms for registration and listen to their questions and comments regarding the tax system in general and Excise Tax in particular.
“The Authority seeks to provide a simple, seamless and intuitive tax system,” Al Bustani said.
The FTA plans to release lists of new prices for products eligible for Excise Tax, which is calculated based on the retail market price.
Individuals and businesses whose operations involve products subject to excise tax must determine whether or not they are required to register with the FTA. Excise goods must be documented and declared by the end of September.
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