Excise Tax is an indirect tax where the liability is ultimately borne by the end consumer of specific goods falling under the UAE’s excise tax regime. Introduced on 1 October 2017, it is primarily aimed at discouraging the consumption of products harmful to health and the environment.
For UK companies doing business in the UAE, understanding excise tax obligations is critical to remain compliant and avoid penalties.
The following items were covered by the excise tax when it was introduced in the United Arab Emirates on October 1, 2017, along with the corresponding tax rate:
The introduction of Excise Tax in the UAE is with the purpose of discouraging the consumption of products which are unhealthy for mankind.
According to Federal Decree Law No. 7 of 2017, UK businesses must register if they:
Import excise goods into the UAE.
Manufacture excise goods within the UAE.
Stockpile excise goods.
Act as a warehouse keeper for excise goods.
Unlike VAT, excise tax has no minimum revenue threshold. Registration should be completed via the Emaratax portal at the intention stage—before engaging in any excise-related activities.
Legal documents of the company.
Identification documents of authorized signatory of the entity, shareholders or partners
Business details
List of Excise Goods the entity is dealing.
Bank Account details
Customs registration details, if applicable.
Details of any criminal, civil, or immigration offenses
The tax rate (50% or 100%) is applied to the higher of:
The retail selling price as published by the Federal Tax Authority (FTA), or
The designated price.
Returns must be filed monthly.
Payment must be made within 15 days of the tax period’s end.
If your excise goods are not yet listed with the FTA, you must apply for product listing before trading. Example: prototype electronic smoking devices.
Certain cases allow for a refund, such as:
Importing raw tobacco for manufacturing in the UAE (already taxed upon import) and then taxed again at the finished product stage.
Excise goods exported outside the UAE (as they are not consumed locally).
Flyingcolour® Tax Consultant and J N J Auditing LLC provide end-to-end accounting, auditing, tax advisory, ESR compliance, anti-money laundering support, payroll services, excise tax compliance, and CFO services to UK businesses operating in the UAE. Our packages are comprehensive, cost-effective, and fully tailored to your operational needs.