The UAE Excise Tax Law entered into force in October 2017, followed by the VAT Law in January 2018. Both taxes are imposed on several categories of goods and services and the financial authorities in Dubai consider that the implementation of such fees will sustain the overall economy of the GCC (Gulf Cooperation Council) countries. Investors from abroad who are determined to enter the Arab market through all sorts of activities must be aware of the applicable legislation and ask for legal advice in this matter. Our lawyers in Dubai are at your disposal with information and legal support if you want to open a company.
Which goods are levied with the excise tax in Dubai?
Even though Dubai is still considered a tax haven, the authorities do not want to scare the investors with the new tax regulations. There have been several debates and conclusions that made the financial authorities decide for the excise tax which was finally imposed on unhealthy goods as a response to the health status of the population in the GCC countries. According to the Excise Tax Law in Dubai, the tobacco products, the carbonated and energy drinks are now levied with rates ranging between 50 and 100%. The excise tax is meant to reduce the consumption of the above-mentioned unhealthy goods and raise the profits which will be eventually invested in the public services in the GCC countries.
Any business dealing with the sale of unhealthy products must align with the provisions of the Federal Decree Law No. 7/2017 on Excise Tax and to fix the prices in accordance. For complete information about this law and the way in which it has to be implemented, please address to our Dubai attorneys.
Who needs to consider the Excise Tax Law in Dubai?
Local and foreign investors who deal with the import of excise goods in the UAE, or with the manufacture of such products in the same territory must observe and respect the provisions of the Excise Tax Law. According to the FTA (Financial Tax Authority) in Dubai, companies need to register for the excise tax before opening a business in the city by filing the forms found on the official website.
In order to avoid any misunderstandings and to easily align with the provisions of the Excise Tax Law, we invite you to contact our law firm in Dubai for legal support.