UAE Excise Tax: What's Taxed, at What Rate, and Registration Rules

Excise goods categories and rates, the no-threshold registration rule, and Designated Zones explained.

Excise Tax is a UAE federal tax, introduced in October 2017 (before VAT), that targets a specific, named list of goods considered harmful to health or the environment — not general commerce the way VAT does.

The categories and rates

Tobacco and tobacco products, electronic smoking devices and the liquids used in them, and energy drinks are taxed at 100% of value. Since 1 January 2026, sweetened drinks are taxed per litre by sugar content per 100 ml: AED 1.09 per litre for 8 g or more, AED 0.79 for 5 g to under 8 g, and AED 0 below 5 g or for artificially sweetened drinks. Carbonated drinks are no longer a separate category, and a drink without a sugar conformity certificate is taxed as high sugar. Excise is separate from VAT — a product can carry both the excise and 5% VAT on top of the excise-inclusive price.

No turnover threshold

Unlike VAT, Excise Tax registration has no minimum revenue figure. Importing, producing, or stockpiling any excise good triggers a registration requirement before doing so — not after reaching some sales threshold.

Designated Zones

A Designated Zone is a fenced, FTA-recognized area (often a free zone warehouse) where excise goods can be stored without the tax being due immediately. Tax becomes due when goods are "released" from that zone for consumption in the mainland UAE — which is why the Excise return separates tax due on production from tax due on release from a Designated Zone; they are genuinely different triggering events.

Filing frequency and deadline

Excise Tax returns are filed monthly and are due by the 15th day of the month following the tax period — a shorter window than VAT's 28 days, reflecting how quickly excise goods move and the FTA's interest in tighter tracking.

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