FTA clarifies excise tax model for sweetened drinks

The Federal Tax Authority (FTA) has called on producers, importers and stockpilers of sugar-sweetened drinks to begin reviewing the sugar content in their products in preparation for the implementation of a new excise tax mechanism set to take effect at the beginning of 2026.

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The new mechanism, to be introduced following the issuance of related legislation, will adopt a Tiered Volumetric Model that links the excise tax per litre of sweetened drinks to the sugar content per 100 millilitres.

The FTA noted that early preparation will ensure a smooth transition once the system is enforced, with producers and importers required to register sweetened drinks as excise goods by submitting certified laboratory reports from facilities accredited by the Ministry of Industry and Advanced Technology (MoIAT). These reports must detail the sugar and sweetener content of each product.

The Authority urged stakeholders to obtain UAE Certificates of Conformity from MolAT regarding sugar and sweetener content, based on laboratory reports from accredited testing bodies such as the National Accreditation Department, the Emirates National Accreditation System or other ISO/IEC 17025-certified laboratories.

According to the FTA, once the new rules take effect, any sweetened drink without a valid UAE Certificate of Conformity will automatically be classified as a high-sugar beverage until laboratory verification confirms otherwise.