The United Arab Emirates’ new Federal Tax Authority (FTA) has announced that businesses subject to excise tax can register from Sunday September 17 to prepare for the tax that will be implemented from the beginning of October. A press statement issued by the FTA said businesses can register through its electronic portal.
The UAE will impose a 50 percent excise tax on carbonated drinks (excluding sparkling water) and a 100 percent tax on tobacco products and energy drinks
Once the excise tax comes into force, consumers of goods subject to excise duty will generally pay a higher price for these products, according to the FTA’s website. It added that “all businesses that import, produce or store excisable goods must consider if they must be registered with the Federal Tax Authority and are accountable for filing and paying Excise Tax.”
Younis Haji Al Khouri, the Undersecretary of the Ministry of Finance, told Emirates News Agency WAM that the tax “shall impact all excise goods consumed inside the country, including all the country's free zones and ports”.
"Commodities carried away out of the country by outbound travelers shall not be impacted by the tax, while those carried into the country shall be subject to the new law," he added.
The tax is part of the UAE’s plan to diversify its sources of income amidst low oil prices. Saudi Arabia had already started implementing a similar excise tax in June on selective goods, and the kingdom saw a slump in the sales of energy and soft drinks
following the tax implementation. However, almost half of all smokers said the introduction of the tax has had no impact
on their habits.
© Zawya 2017