Representative image of sugar-sweetened beverages.
Abu Dhabi: The United Arab Emirates (UAE) will introduce a new tiered excise tax on sugar-sweetened beverages from January 1, 2026, following the completion of legislative amendments by the Ministry of Finance.
The move aims to align the country’s tax framework with Gulf Cooperation Council (GCC) directives and international best practices while supporting public health and fiscal sustainability goals.
The updated policy adopts a tiered volumetric model, where tax rates will vary based on the sugar content or the use of other sweeteners in beverages. The amendments are designed to ensure the smooth national implementation of the policy, enhance tax efficiency, and foster a transparent and competitive business environment.
The Ministry said the new framework also introduces a deduction mechanism for taxable businesses that have imported or produced goods subject to the existing 50 percent excise tax before the new policy takes effect. If their tax liability decreases as a result of the amendments, and the goods remain unsold, they will be able to recover part of the previously paid tax.
According to the Ministry, the legislative update reflects the UAE’s proactive approach to modernising its financial system, strengthening trust with taxpayers, and contributing to the country’s broader economic and public health objectives.
This post was last modified on October 6, 2025 5:35 pm