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UAE announces tax on energy drinks and tobacco

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If you need a mid-afternoon boost from an energy drink, or regularly pop to the smokers area, it looks like your habit is going to get more expensive. A decree has been issued on excise tax in the UAE, which will be imposed on select harmful products, including tobacco, energy drinks and some soft drinks.

President His Highness Sheikh Khalifa bin Zayed Al Nahyan issued the Federal Decree-Law on Excise Tax, with products determined by the Council of Ministers and recommended by H.H. Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai and UAE Minister of Finance, and Chairman of the Federal Tax Authority, FTA.

This means that specific goods will be taxed at an amount determined by the Council Ministers, on the recommendation of the Minister of Finance, as long as the tax imposed doesn’t exceed 200 percent of the excise price.

His Highness Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai and the Minister of Finance and Industry of the UAE, explained that this will help the economy while discouraging people to consume products that are harmful to their personal health and the environment.

“The project diversifies the Government’s revenue streams and boosts its resources, which, in turn, will strengthen the economy and ensure its sustainability,” H.H. Sheikh Hamdan bin Rashid said. “The Excise Tax, in particular, will help us build a healthier and safer society. This tax is set to discourage the consumption of products that negatively impact the environment and, more importantly, people’s health, while the revenues it generates will go towards supporting advanced services for all members of society.”

This tax will also apply to activities such as the production, importation or stockpiling of excise goods in the UAE.

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