Excise Tax in UAE is an indirect tax levied on certain good that are not good to human health or the environment. The intent of the tax is to reduce consumption of these goods with increasing revenues for the government that can be spent on beneficial public services. In UAE, Excise Tax has come into effect on 1 October 2017 by virtue of Federal Decree-Law No (7) of 2017, passed by its President.
Excise Tax will be levied upon Carbonated drinks, Energy Drinks and Tobacco as and when these goods are ‘released for consumption’ i.e. when they enter free circulation in the UAE. Producers, Importers, Stockpilers, Warehouse keepers of excise goods will need to register with the FTA and submit excise tax returns on a monthly basis Pay the excise tax due on excise goods.
The Federal Tax Authority (FTA), the government entity is responsible for the collection and management of federal taxes. FTA Helping the business community and consumers understand their responsibilities with regard to taxation, and guide them to full compliance and helping taxpayers understand and willingly comply with their tax obligations.
Producers, Importers, Stockpilers, Warehouse keepers of excise goods will need to register with the FTA and submit excise tax returns on a monthly basis, and pay the excise tax due on excise goods.
In the UAE Carbonated drinks will be charged at the rate of 50%, Energy drinks and Tobacco will be subject to 100% excise tax. Excise tax will be applied to the retail-selling price of the goods, at the rate applicable to the excise good in question. A designated zone is the term used in the UAE to describe a specified area that is considered outside the UAE for excise tax purposes. Penalty will be imposed on noncompliance with law and regulation and in the case of tax evasion.
There will be need of professional Excise consultant to understand complete law, regulation relating with excise tax. To prepare your business for the economic impact of new legislation released by FTA and complying with these legislation, with the help of a professional Excise consultant in Dubai – partner with MAC & ROSS Chartered Accountants today.