In line with the directives of
the wise leadership to strengthen the UAE's country's global competitiveness, the Federal Tax Authority (FTA)
is keen to enhance its effective contribution to implementing government
policies aimed at safeguarding public health. The Authority's role is not
limited to supporting the diversification of the national economy through the
administration and collection of federal taxes in accordance with international
best practices. It also plays a pivotal role in accelerating efforts to build a
safe and healthy society and to preserve the quality of life in the UAE.
This role is reflected through
the successful implementation of Excise Tax and the continuous development of
its implementation mechanisms to support ongoing efforts to combat smoking and
the consumption of tobacco and related products, as well as other harmful
goods, and to reduce the consumption of products that negatively impact human
health or the environment.
In 2026, the new mechanism for
calculating Excise Tax on sweetened beverages based on the Tiered Volumetric
Model was introduced. This model links the value of the tax imposed on each
litre of sweetened beverage to the total amount of sugar and other sweeteners per
100 ml of the beverage, instead of calculating the tax as a fixed percentage,
as was previously the case. This is implemented in accordance with the UAE
Cabinet Decision concerning excise goods, the applicable tax rates or amounts,
and the method of calculating the excise price.
Under the Decision, carbonated
beverages are no longer classified as a separate category of excise goods.
Instead, the Excise Tax on carbonated beverages is determined based on their
sugar content and they are classified as sweetened beverages. Energy drinks,
however, remain subject to Excise Tax at 100% of the excise price, and are not
subject to the tiered volumetric model.
Since the beginning of 2026,
there has been strong uptake of the sweetened beverage registration service
based on the tiered volumetric model through the EmaraTax platform, which
provides digital tax services around the clock. More than 16,000 products have
been registered and updated in accordance with the requirements of the Decision.
Accordingly, the Authority developed the sweetened beverage registration
service through a smart and integrated registration system linked with relevant
entities, utilising the latest AI technologies to ensure clarity, speed, and
efficiency, in line with the Authority's ongoing efforts to enhance its
services. Registration applications can be submitted in four simple electronic
steps via the EmaraTax platform.
This step is expected to
encourage beverage manufacturers to reduce sugar levels in their products to
lower the applicable tax burden. This would improve product formulations
through the use of healthier sweetening alternatives and reduce the health
risks associated with excessive sugar consumption. It will also support
competitiveness by encouraging the development of lower-calorie products that
better meet consumer needs and may contribute to stabilizing or reducing the
price of some products as their formulations are improved and sugar content
reduced.
We expect continued demand for
registering and updating sweetened beverage product records during the coming
period in line with the new mechanism, particularly as awareness increases and
tax procedures remain simple and accessible.
We will continue to advance
towards establishing a smarter, more transparent, and more efficient tax system
that aligns with the vision of our wise leadership, places people at the
forefront of its priorities, and enhances the UAE's global competitiveness.
Continuous development is not a choice but a firm commitment through which we
strive to deliver proactive services that enhance the customer experience and
contribute to building a sustainable national economy founded on trust, driven
by compliance, and guided by leadership.
Abdulaziz Al Mulla
Director General
Federal Tax Authority