UAE excise tax will see some products taxed by up to 100 per cent.

You’ll pay a lot more for cigarettes, energy drinks and soft drinks starting from Sunday.

After the UAE excise tax was officially announced in August, the Federal Tax Authority said on Wednesday it was all set to implement the tax on certain products next week.

Starting from October 1, the tax will be 100 per cent for tobacco and energy drinks, and 50 per cent for fizzy drinks (except carbonated water).

Shisha, a tobacco product, will also be subject to the tax at the rate of 100 per cent.

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We checked our local store, and the new law means you can expect to pay around Dhs22 for a Red Bull, Dhs4.50 for a fizzy drink and Dhs24 for a packet of cigarettes.

HH Sheikh Hamdan bin Rashid Al Maktoum, deputy ruler of Dubai, said in August the excise tax would help to build a “healthier and safer society”.

“This tax is set to discourage the consumption of products that negatively impact the environment and, more importantly, people’s health, while the revenues it generates will go towards supporting advanced services for all members of society,” he said.

Around 100 products will be exempt from the tax, described as essentials such as education, food and healthcare.

This is all gearing up towards January 1 2018, when a blanket 5 per cent VAT (value-added tax) will roll out across the UAE in order to help stave the continuing drop in oil prices across the region.

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