05 Feb 2025
The UAE Ministry of Finance has recently announced Ministerial Decision No. 1 of 2025, clarifying the implementation of Cabinet Decision No. 52 of 2019 on excise goods, excise tax rates, and the methods of calculating the excise goods price. These regulations align with the Gulf Cooperation Council (GCC) Common Schedule for Classification and Coding of Goods, ensuring a standardized approach across the region.
Key Updates on Excise Tax Rates and Calculations:
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Liquids Used in Electronic Smoking Devices
Excise Tax now applies to all liquids used in electronic smoking devices and tools and the like, whether or not they contain nicotine. Classification is based on the GCC Common Schedule.
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Electronic Smoking Devices & Tools
Excise Tax applies to electronic smoking devices and tools and the like, whether or not containing nicotine or tobacco. A harmonized system codes specified in Chapter Eighty-Five of the Common Schedule for Classification and Coding of Goods for the Gulf Cooperation Council Countries in force shall apply.
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Excise Tax Price for Concentrates, Powders, Gels, and Extracts
The calculation of the Excise Price of concentrates, powders, gel, or extracts that can be transformed into carbonated drinks, energy drinks, or sweetened drinks shall be the higher of the following:
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Standard price list issued by the authority
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The designated selling price to the retailer before any discounts or offers, after deducting the Tax included in accordance with the mechanism provided in Cabinet Decision No. 52 of 2019.
The Taxable Person shall keep the records required to evidence the “Designated Selling Price” of the excise good, and any deductions made thereon, and the quantities sold.
Impact on Your Business
With these updated regulations, importers, producers/manufacturers, warehouse-keepers, and stockpilers of electronic smoking products must ensure full compliance to avoid penalties.
How AMCA Can Help
At AMCA, we specialize in tax consultancy, compliance solutions, and regulatory advisory. Our experts can assist you with:
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Excise tax registration and compliance
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Product registration if products are not available at the FTA portal
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Audit preparation and documentation support
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Guidance on tax-efficient business strategies
Ensure your business remains compliant and optimized under the new excise tax regulations. Contact AMCA today for a 30-minute free consultation, and let our team guide you efficiently!
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