Excise Tax Obligations in the UAE (2026 Legal Guide) — Rules & Requirements
About this article
Sourced from Omani royal decrees, ministerial decisions, and the Basic Statute of the State. Written in plain language for general understanding — this is educational content, not legal advice. Our editorial standards
What is this right?
The UAE imposes excise tax on specific goods considered harmful to health or the environment. This was the first federal tax introduced in the UAE (October 2017), even before VAT:
- Tobacco products: Taxed at 100% of the retail price — including cigarettes, cigars, and all tobacco preparations.
- E-cigarettes and vaping liquids: Taxed at 100%.
- Energy drinks: Taxed at 100%.
- Carbonated drinks: Taxed at 50% (excluding unflavoured sparkling water).
- Sweetened drinks: Taxed at 50% (any drink with added sugar, sweeteners, or flavouring).
- Who pays: Excise tax is paid by importers and manufacturers at the point of import or production, but the cost is passed on to consumers through higher retail prices.
- Digital tax stamps: Many excise goods must carry a digital tax stamp (DTS) — a marking system managed by the FTA that allows tracking from production to retail.
When does it apply?
- You import, manufacture, or stockpile excise goods in the UAE.
- You release excise goods from a designated zone (free zone warehouse) into the UAE mainland market.
- As a consumer, excise tax is built into the price you pay at the store — you do not pay it separately.
What to Do If Your UAE Business Imports or Produces Excise Goods
- If you import or produce excise goods, register with the FTA for excise tax through EmaraTax before starting operations.
- File excise tax returns monthly through the EmaraTax portal by the 15th of the following month.
- Keep detailed records of all excise goods you import, produce, or release from designated zones.
- Apply the digital tax stamp (DTS) to all products that require it — the FTA provides the DTS system and specifications.
What should you NOT do?
- Do not sell excise goods without registration if you are an importer or manufacturer — penalties start at AED 10,000.
- Do not stockpile excise goods before a rate change to avoid paying the new rate — the FTA monitors inventory levels and can impose the higher rate retroactively.
- Do not import excise goods for personal use above the allowed limits without declaring them at customs — UAE Customs (now under ICP) enforces these limits at all ports of entry.
About Tax Rights in Oman
You pay no personal income tax in the UAE — salaries, freelance, investments, and rental income are all untaxed. Businesses face 5% VAT under Federal Decree-Law No. 8 of 2017 if turnover exceeds AED 375,000, and 9% corporate tax on profits above AED 375,000 under Federal Decree-Law No. 47 of 2022. The Federal Tax Authority runs everything through EmaraTax. Disputes follow a 40-business-day ladder under Federal Decree-Law No. 28 of 2022: FTA reconsideration, then the Tax Disputes Resolution Committee, then the Federal Court of Appeal.
Common Questions
What is the excise tax obligations right in Oman?
The UAE imposes excise tax on specific goods considered harmful to health or the environment. This was the first federal tax introduced in the UAE (October 2017), even before VAT:Tobacco products: Taxed at 100% of the retail price — including cigarettes, cigars, and all tobacco preparations.E-cigarettes and vaping liquids: Taxed at 100%.Energy drinks: Taxed at 100%.Carbonated drinks: Taxed at 50% (excluding unflavoured sparkling water).Sweetened drinks: Taxed at 50% (any drink with added sugar, sweeteners, or flavouring).Who pays: Excise tax is paid by importers and manufacturers at the point...
When does it apply — excise tax obligations?
You import, manufacture, or stockpile excise goods in the UAE.You release excise goods from a designated zone (free zone warehouse) into the UAE mainland market.As a consumer, excise tax is built into the price you pay at the store — you do not pay it separately.
What should I do if my business in the UAE imports tobacco, energy drinks, or carbonated drinks?
If you import or produce excise goods, register with the FTA for excise tax through EmaraTax before starting operations.File excise tax returns monthly through the EmaraTax portal by the 15th of the following month.Keep detailed records of all excise goods you import, produce, or release from designated zones.Apply the digital tax stamp (DTS) to all products that require it — the FTA provides the DTS system and specifications.
What should you NOT do — excise tax obligations?
Do not sell excise goods without registration if you are an importer or manufacturer — penalties start at AED 10,000.Do not stockpile excise goods before a rate change to avoid paying the new rate — the FTA monitors inventory levels and can impose the higher rate retroactively.Do not import excise goods for personal use above the allowed limits without declaring them at customs — UAE Customs (now under ICP) enforces these limits at all ports of entry.