CD 197/2025 — Excise goods, rates and amounts, and the Excise Price

Factual summary

Replaces the 2019 list of excise goods from 1 January 2026: tobacco products, electronic smoking devices and liquids, and energy drinks stay at 100%, carbonated drinks are no longer listed, and sweetened drinks are taxed by sugar content per litre — AED 1.09 for 8 grams or more per 100 millilitre, AED 0.79 for 5 to under 8 grams, and AED 0 below 5 grams or with artificial sweeteners only. It keeps the Excise Price method (the higher of the FTA price list and the designated retail sales price less tax), and requires an FTA-accepted laboratory report on sugar content, failing which the highest band applies.

What it means in practice Professional insight

Who: makers, importers and stockpilers of sweetened and energy drinks, tobacco and vaping products. What to check: the sugar band of each sweetened drink backed by an accepted laboratory report, registration of products with the FTA at the right per-litre amount, and the four-decimal rounding.

Key provisions

• Arts. 2–5 For Art. 2 of the Decree-Law, the Excise Goods are tobacco and tobacco products, liquids used in electronic smoking devices and tools, electronic smoking devices and tools, energy drinks and sweetened drinks. Tobacco products cover all items of Chapter 24 of the GCC Common Customs Tariff imported, cultivated or produced in the State, including electrically-heated cigarettes, except products exclusively intended to assist in smoking cessation; the customs codes of the excluded products, the liquids and the devices (whether or not containing nicotine or tobacco) are set by a decision of the Minister.
• Arts. 7, 8 A sweetened drink is a product with an added source of sugar, artificial sweeteners or other sweeteners, produced for consumption as a drink in any form (ready-to-drink, concentrate, powder, gel or extract); sugar follows GSO Standard 148 and artificial sweeteners GSO Standard 995. Excluded: beverages containing at least 75% Milk or 75% Milk Substitutes of the ready-to-drink beverage, baby formula, follow-up formula or baby food, beverages for special dietary needs (GSO 654) or medical uses (GSO 1366), drinks prepared in restaurants or similar establishments and served in open, unsealed containers for direct consumption, and drinks containing alcohol.
• Art. 10(1) Rates or amounts: tobacco and tobacco products, liquids used in electronic smoking devices and tools, electronic smoking devices and tools, and energy drinks 100%; sweetened drinks containing 8 grams or more of sugar or other sweeteners per 100 millilitre AED 1.09 per litre; 5 grams or more but less than 8 grams AED 0.79 per litre; less than 5 grams AED 0 per litre; only artificial sweeteners, or artificial sweeteners and less than 5 grams of sugar or other sweeteners, AED 0 per litre.
• Art. 10(2)–(4) For concentrates, powders, gels and extracts the sugar content is calculated on the final product form under the Producer's guidelines; if none exist or they prove inaccurate, the Authority sets the mechanism. Naturally occurring sugar counts toward the sugar content. Fractions of a Fils are rounded at the level of the good to the nearest four decimal places of the Dirham on registration with the Authority, and the Tax Due on periodic returns to the nearest Fils.
• Arts. 11, 12 The Excise Price is the higher of the price in the Authority's published standard price list (if any) and the designated retail sales price less the Tax included in it; for goods taxed at 100% the Tax included equals half of the designated retail sales price. The designated retail sales price is the higher of the recommended retail selling price declared and affixed by the Importer or Producer after deducting VAT (excluding hotel, restaurant or similar on-premises mark-ups) and the average market retail selling price after deducting VAT. The Excise Price of energy-drink concentrates, powders, gels or extracts follows a mechanism specified by the Minister.
• Art. 13 The Authority may set procedures to prove whether a product is an Excise Good and request documents or laboratory tests; if they are not provided in time, it may treat the product as an Excise Good until proven otherwise. For sweetened drinks the person must submit a laboratory report accepted by the Authority proving the quantity of sugar and other sweeteners and whether the drink contains artificial sweeteners; without it, the Tax is imposed at the category with the highest quantity of sugar and other sweeteners until a report proves another category.
• Arts. 14, 15 Repeals Cabinet Decision No. 52 of 2019 and every provision that violates or conflicts with this decision; published in the Official Gazette and effective from 1 January 2026.