Excise Tax Advisory Services in Dubai

Excise tax can be complex to handle, especially for businesses dealing with regulated goods in Dubai and across the UAE. From determining whether your products are subject to excise tax to ensuring accurate registration, filing, and compliance, even small mistakes can lead to penalties.

This is where excise tax advisory becomes essential. Professional excise tax advisory services in the UAE help businesses stay compliant with local regulations, manage risks effectively, and handle excise tax obligations with clarity and confidence. With the right guidance, companies can focus on running their operations smoothly while ensuring their excise tax responsibilities are handled correctly and on time.

What is the Excise Tax in the UAE?

Excise tax in the UAE is a selective tax introduced by the government to reduce the consumption of products that are harmful to health or the environment. At the same time, it helps generate revenue for public services.

Unlike VAT, excise tax doesn’t apply to most everyday goods. It is charged only on specific products that fall under the excise category, and the tax is usually applied at the time of import, production, or release for consumption.

Why Was Excise Tax Introduced?

The UAE introduced excise tax to:

• Discourage the use of harmful products
• Promote healthier lifestyle choices
• Support public health initiatives
• Create a sustainable source of government revenue

In simple terms, higher taxes make these products more expensive, reducing excessive consumption.

Products That Attract Excise Tax in the UAE

In the UAE, excise tax is imposed on specific products deemed harmful to human health or the environment. The goal is to reduce consumption while also generating government revenue. Currently, excise tax applies to a limited list of goods:

• Tobacco and tobacco products: taxed at 100% to discourage smoking and related health risks.
• Electronic smoking devices and liquids: taxed at 100%, covering vapes, e-cigarettes, and their refills.
• Carbonated drinks: taxed at 50%, excluding plain sparkling water.
• Energy drinks: taxed at 100% due to their high caffeine and stimulant content.
• Sweetened drinks (including certain juices and concentrates): taxed at 50%, as they contain added sugars or sweeteners.

If your business imports, manufactures, warehouses, distributes, or sells any of these products in the UAE. You are required to register for excise tax and comply with all related regulations. It includes filing returns and maintaining proper records. Non-compliance can result in penalties and fines.

Products Exempted from Excise Tax

Excise tax is usually applied to products considered harmful to health or the environment. However, not all goods fall under this tax regime. Certain products are fully exempt, while others may qualify for conditional exemptions based on how they’re used or supplied.

Basic Food & Essential Goods

Everyday staples that do not pose health risks, such as fresh fruits, vegetables, grains, dairy, and unprocessed foods, are not subject to excise tax.

Medicinal Products

Pharmaceuticals and medicines approved by relevant health authorities are exempt, as they are essential for treatment and well-being.

Medical Devices

Equipment and devices used forthe diagnosis, treatment, or prevention of diseases are excluded from excise tax.

Non-sweetened Beverages

Drinks without added sugar or sweeteners, like plain bottled water or unsweetened natural beverages, are exempt.

Exports Outside the Country

Excise goods that are manufactured locally but exported outside the country are typically exempt, as excise tax targets local consumption.

Conditional or Special Exemptions

Some excise goods may be exempt only if specific conditions are met, such as:

• Goods used strictly for industrial or research purposes
• Products stored under excise tax suspension arrangements
• Goods destroyed under official supervision

Proper documentation and regulatory approval are usually required for these exemptions.

What are the UAE Excise Tax Rates?

Here are the current UAE Excise Tax rates (on select harmful products):

• 100% on tobacco & tobacco products (including vaping devices and related liquids) and energy drinks.
• 50% on carbonated drinks.
• 50% on sweetened drinks (subject to a new sugar-based tiered model effective Jan 1, 2026).

Note: New rules from January 1, 2026, will tax sweetened beverages based on sugar content rather than a flat 50% rate.

Who Needs to Register for Excise Tax?

You must register for excise tax if you:

• Import excise goods into the UAE
• Manufacture excise goods locally
• Stockpile excise goods in the UAE
• Release excise goods for consumption

Even if you don’t sell directly to consumers, you may still be liable depending on your role in the supply chain. This is where excise tax advisory services in Dubai become extremely useful, as the rules can be technical and easy to misinterpret.

Documents Required for Excise Tax Registration in the UAE

Businesses must submit the following documents to the Federal Tax Authority (FTA) while registering for Excise Tax:

• Valid Trade License
• Memorandum of Association (MOA) or Articles of Association
• Passport copy & Emirates ID of the owner / authorised signatory
• Power of Attorney (if applying through a tax agent)
• Details of excise activities (manufacturing, importing, storing, or stockpiling)
• Information on excise goods dealt with (tobacco, energy drinks, sweetened drinks, e-smoking devices, etc.)
• Customs Registration Number (if applicable)
• Warehouse or designated zone details (if applicable)
• Business bank account details
• Official email address and contact number
• Proof of business address (Ejari/tenancy, if required)

Note: The FTA may request additional documents during the verification process.

Excise Tax Record-Keeping Requirements in the UAE

A Practical Guide by Excise Tax Advisory Experts

Under UAE Excise Tax regulations, every excise-registered business must maintain detailed, accurate records to ensure full compliance with the Federal Tax Authority (FTA) requirements. These records must be preserved for at least one year prior to the implementation ofthe  Excise Tax and must be readily available for audit purposes.

As part of professional excise tax advisory services in the UAE, we strongly recommend maintaining a structured documentation system covering all excise-related transactions.

Mandatory Excise Records to Be Maintained

An excise-registered taxable person is required to maintain comprehensive documentation covering the movement, storage, sale, and taxation of excise goods, including:

1. Product & Inventory Records

• Complete accounts and supporting documents for all excise goods imported, manufactured, or stockpiled
• Detailed physical inventory records showing item-wise quantity and value
• Records of average monthly inventory levels
• Statements showing average monthly sales per excise product
• Item-wise records of excise goods:
  • Manufactured locally
  • Imported into the UAE
  • Sold within the UAE
  • Exported outside the UAE
  • Released from designated zones

2. Import, Export & Stock Movement Documentation

• Proof of excise goods exported outside the UAE
• Supporting documentation for excise products sold outside the UAE
• Records of excise goods purchased from overseas suppliers
• Details of excise goods lost, damaged, or destroyed

3. Tax Records & Financial Documentation

• Tax records showing excise tax due on:
  • Goods imported or manufactured in the UAE
  • Goods purchased or produced for stockpiling purposes
• Evidence of excise tax paid and subsequently deducted on goods exported outside the UAE
• Complete excise tax calculation workings and adjustments

4. Sales & Distribution Information

• Details of distributors, retailers, and companies to whom excise goods are sold
• Item-wise tracking of excise goods supplied across different sales channels

Maintaining these records is a core pillar of effective excise tax advisory compliance in the UAE and significantly reduces audit risks.

FTA Audits, Compliance & Enforcement

The Federal Tax Authority actively monitors excise-registered businesses through an integrated system linked directly to UAE Customs. All excise goods are identified using specific item codes, making non-compliance easily traceable.

As part of its enforcement powers, the FTA may:

• Conduct tax audits on excise-registered entities
• Cross-verify customs import data with excise tax filings
• Restrict customs clearance of excise goods for non-registered businesses

Professional excise tax advisory services in Dubai play a crucial role in helping businesses stay audit-ready and compliant.

Excise Tax Penalties You Should Know About

Failure to comply with Excise Tax obligations can lead to significant penalties, including:

• AED 20,000 penalty for failing to register for Excise Tax within the prescribed deadline
• AED 20,000 penalty for failing to declare excess stock of taxable goods held before the implementation date

Engaging reliable excise tax advisory services ensures timely registration, accurate reporting, and penalty avoidance.

Why Work with an Excise Tax Advisory in Dubai?

Handling Excise Tax laws requires precision, documentation discipline, and ongoing compliance monitoring. A trusted excise tax advisory Dubai partner can help you with:

• Excise Tax registration and deregistration
• Record-keeping system setup
• Excise return filing and reconciliation
• Audit support and FTA correspondence

With expert expertise in tax advisory services in the UAE, businesses can focus on growth while staying fully compliant with tax regulations.

Why Choose Shuraa for Excise Tax Advisory in Dubai?

Handling Dubai’s excise tax landscape requires deep expertise, local insight, and strategic foresight.

At Shuraa Tax, we go beyond compliance; we partner with businesses to unlock efficiency, minimise risks, and optimise tax outcomes. Here’s why choosing Shuraa for Excise Tax Advisory is the smart decision for companies aiming to thrive in the UAE market.

• Strong UAE Tax Expertise: Our experts stay up to date on UAE to excise tax laws to ensure accurate compliance at all times.
• Customised Excise Tax Solutions: Advisory customised to your business model, products, and operational structure.
• End-to-End Excise Tax Support: From registration and returns to audits and compliance management, all under one roof.
• Proactive Risk Management: We help minimise errors, penalties, and compliance gaps with structured processes.
• Experienced Tax Professionals: Industry-backed advisory with practical, business-focused guidance.
• Integrated Business Services: Seamless support alongside accounting, VAT, and corporate services.

Get Expert Excise Tax Support with Shuraa Tax

Managing excise taxes in the UAE doesn’t have to be stressful or complicated. With frequent regulatory updates, strict FTA monitoring, and heavy penalties for non-compliance, having the right to excise tax advisory partner makes all the difference.

With professional excise tax advisory services in the UAE, businesses can stay compliant, reduce risks, and handle registrations, filings, and audits with confidence. Whether you’re importing, manufacturing, stockpiling, or distributing excise goods, expert excise tax advisory support in the UAE ensures every obligation is met accurately and on time.

At Shuraa Tax, our customised excise tax advisory services in Dubai help businesses handle excise regulations smoothly while focusing on growth. From registration to audit support, our excise tax advisory Dubai team is here to simplify compliance and protect your business.

Call: +(971) 44081900
WhatsApp: +(971) 508912062
Email: info@shuraatax.com

Reach out today for reliable excise tax advisory services designed for your business needs in Dubai and across the UAE.

Frequently Asked Questions (FAQs)