CD 38/2017 — Excise goods, rates and the Excise Price (repealed)

Factual summary

The first list of UAE excise goods: tobacco and tobacco products (all of Chapter 24 of the GCC Common Customs Tariff) and energy drinks at 100%, and carbonated drinks at 50%, including concentrates, powders, gel and extracts. It set the Excise Price as the higher of the FTA price list and the designated retail sales price less the Tax included in it (two thirds of that price for goods taxed at 50%, one half for goods taxed at 100%), and defined the designated retail sales price as the higher of the importer's or producer's labelled retail price and the average market retail price over twelve months.

What it means in practice Professional insight

Who: businesses reviewing excise returns for periods from 1 October 2017 to 30 November 2019. What to check: the rate applied per product, the classification of drinks meeting both the carbonated and energy-drink definitions, and the evidence of the designated retail sales price; later periods follow CD 52/2019 and, from 1 January 2026, CD 197/2025.

Key provisions

• Arts. 2, 3 For Art. 2 of the Decree-Law, Excise Tax was imposed on three Excise Goods: tobacco and tobacco products, carbonated drinks and energy drinks. Tobacco and tobacco products covered all items in Chapter 24 of the GCC Common Customs Tariff imported, grown or produced in the State.
• Arts. 4, 5 Carbonated drinks were any aerated beverage except unflavoured aerated water, and any concentrates, powders, gel or extracts that can be made into one; energy drinks were beverages marketed or sold as energy drinks that may contain stimulants providing mental or physical stimulation (including caffeine, taurine, ginseng and guarana, or substances with an identical or similar effect), and their concentrates, powders, gel or extracts. Alcoholic beverages were excluded; a drink made by mixing a concentrate, powder, gel or extract already taxed in the State at the place where it is sold for consumption by a non-Taxable Person was not an Excise Good, and the Tax paid on that product was not Deductible Tax under Art. 16 of the Decree-Law; a product meeting both definitions was an energy drink taxed at the energy-drink rate.
• Art. 6 Tax rates under Art. 3 of the Decree-Law: tobacco and tobacco products 100%; carbonated drinks 50%; energy drinks 100%.
• Art. 7 The Excise Price was the higher of the price published by the Authority for the Excise Good in its price list (if any) and the designated retail sales price less the Tax included in it: for goods taxed at 50% the Excise Price equalled two thirds of the designated retail sales price, and for goods taxed at 100% one half of it. The Excise Price of carbonated-drink concentrates, powders, gel or extracts followed a mechanism set by the Minister of Finance.
• Art. 8 The designated retail sales price was the higher of the recommended retail selling price set, declared and labelled by the importer or producer (excluding price increases from sale in a hotel, restaurant or similar establishment for consumption there) and the average market retail price over the previous twelve months, recalculated at least once every (6) six months; it had to include all fees and taxes due on the goods except VAT. A Taxable Person unable to determine it had to inform the Authority at least (15) days before the tax return was due, and the Authority could permit Tax to be calculated on the cost of the Excise Good.
• Arts. 9, 10 Every provision violating or conflicting with the Decision was repealed; effective from 2017/10/01 and published in the Official Gazette.
• Repeal Repealed by Cabinet Decision No. 52 of 2019 (Art. 16), which applied from 1 December 2019 (date set by Ministerial Decision No. 236 of 2019, Art. 5, under Art. 17 of CD 52/2019).