Excise Tax
The UAE government imposes an indirect tax known as the excise tax on products that are deemed damaging to the environment or human health. The basic objective of the excise tax is to reduce consumer appetite for these commodities and so elevate government money for the benefit of the average citizen.
With effect from October 1, 2017, the Excise Tax Federal Decree-Law No. (7) of 2017 introduced the UAE’s first excise tax on specific commodities. Later, in accordance with Cabinet Decision No. 52 of 2019, a few more products were included in the scope of excise duty with effect from the first day of December 2019. Through the FTA’s online site, all taxable entities have the right to register for excise tax in the UAE.
Goods subject to UAE Excise Tax
- Carbonated Drinks: Any aerated beverage
- Energy Drink: Any beverage that may contain stimulant substances that provide mental and physical stimulation and is marketed or sold as an energy drink
- Tobacco and Tobacco Products: All items listed within Schedule 24 of the GCC Common Customs Tariff, including electrically heated cigarettes
- Electronic Smoking Devices and Tools: All electronic smoking tools and devices, whether containing nicotine or tobacco.
- Liquids used in electronic smoking devices and tools: all liquids used in such devices, whether containing nicotine or tobacco.
- Sweetened Drinks: Any beverage to which a source of sugar or other sweetener is added, as determined under Standard 148 and Standard 995 of the GCC Standardization Organization
The below-mentioned groups are required to register for excise tax in the UAE.
- Producers of excise goods
- Importers of excise goods
- Stockpilers of excise goods
- Warehouse keepers are responsible for excise goods.
HOW CAN WE HELP?
1. Assessing the effects of excise or selective taxes on business operations and products, the effect on the tax’s valuation, determining the tax rate, etc.
2. Determining whether excise tax applies to the goods they imported, assisting with the client’s registration for excise tax in the UAE, and assisting with submitting monthly excise returns.
3. Assisting with the registration procedure for excise and selective taxes, quarterly compliance inspections, training on excise taxes, filing excise tax statements, and clarification requests, among other things.
4. Certain nations demand that the UAE corporation provide a tax residency certificate or a tax domicile certificate to avoid double taxation. Our team of professionals reviews the situation and works with businesses in the UAE to file and apply for a tax residency certificate effectively.
