Excise Tax Services in UAE
Registered Tax Agent Regulated by the FTA (Federal Tax Authority)
Excise Tax Services in the UAE
Registration, Compliance, and Advisory for UAE Excise Tax Obligations
Excise Tax is an indirect tax imposed on specific goods considered harmful to human health or the environment. Introduced in the UAE in 2017, it applies to targeted goods including tobacco products, electronic smoking devices, energy drinks, carbonated beverages, and sweetened drinks.
Farahat & Co. provides professional excise tax services helping businesses meet their registration, filing, and compliance obligations with the Federal Tax Authority.
What is Excise Tax in the UAE?
Excise Tax is a federal indirect tax levied on the production, import, or release from a designated zone of specific goods that are considered harmful to health or the environment. The tax was introduced in October 2017 under Federal Decree-Law No. 7 of 2017 on Excise Tax, with the dual objective of discouraging consumption of harmful products and generating public revenue.
Who Must Register and Which Business Activities Subject to Excise Tax
It applies to the businesses that are engaged in production, importing, keeping, or the disposal of excise goods in UAE. The entities to be registered by FTA include the following:
- Producers or manufacturers of commodities like tobacco, energy drinks, or sweet drinks.
- Those importers that enter the UAE with excise goods.
- Stockpilers who possess a large amount of excise goods in trade.
- Warehouse keepers, distributors and retailers involved in handling the excise goods in the supply chain.
Provided that your business deals with tobacco or sells e-cigarettes or carbonated drinks, you can be legally registered to do the same in Dubai and in the UAE.
What is Registration Process
- Determine Your Obligation:
Determine whether your business operations are the production of excise goods, importation or storage of excise goods in UAE. - Gather Required Documents:
Get ready such documents as your Trade License, Certificate of Incorporation, Emirates ID, the passport copy of the authorized signatory and the Customs Number in case of need. - Create an EmaraTax Account:
File your business on the portal, which is the official site of FTA. - Submit the Application:
Register and log-in to your account, complete the form, and provide necessary documents after which you submit your application.
Post-Registration Compliance:
A Tax Registration Number (TRN) will be issued to you once you are approved. You will have to submit regular monthly returns, pay up taxes and ensure that you abide by the FTA regulations.
Non-Compliance Penalties
Lack of adherence to UAE excise tax laws may lead to significant financial and legal penalties, including:
- Failure to register for excise tax when required: AED 10,000.
- Failure to deregister when required: AED 1,000 per month, up to a maximum of AED 10,000.
- Late payment of tax due:
- 2 % of the unpaid tax immediately after the due date.
- 4 % monthly thereafter, up to a maximum of 300 % of the unpaid tax.
- Failure to file excise tax returns on time: fixed administrative penalties and interest may apply in addition to the above late-payment penalties.
- Failure to maintain or provide required records: AED 10,000 for the first offence and AED 20,000 for repeat offences.
- Violation of Digital Tax Stamp (DTS) regulations: fines up to AED 50,000 plus 50 % of the unpaid or undeclared excise tax on the goods.
- Failure to display prices inclusive of excise tax or non-compliance with price declaration requirements: fines starting from AED 5,000 and increasing for repeated offences.
- Tax evasion or deliberate misreporting: may result in audit, seizure of goods, suspension or cancellation of business licence, and criminal prosecution.
In order to evade punishment it is highly recommended to seek professional representation in Dubai like Farahat and Co. so that there is correct compliance.
What is the Importance Of Registration
- Avoid Fines: Eliminate non-compliance or non-timely financial losses.
- Develop Compliance: Develop a transparent and legal business structure.
- Develop Business Credibility: Partners and clients like compliant businesses.
- Avoid complications with a Business License: The registration status is examined by many licensing authorities.
- Act in Compliance with the Law: Pay all the obligations of the federal taxes in the UAE.
- Improve Supply Chain Management: Registered organizations deal with such type of goods effectively and in compliance to laws.
Understanding Excise Tax and Its Legal Framework in the UAE
The law of Federal Excise duty is a legal tool which is enacted through the legislation of UAE. It specifies exxtice goods, applicable rates, exemptions and compliance requirements. The legislation defines it as an indirect kind of levy and this is levied at the stage of production or importation instead of being levied directly on the consumers.
Certain Designated Zones in the UAE can receive the exemptions of the excise, based on the specific business and storage facility. Those companies that work in these zones are required to keep a record that shows compliance.
Excise Tax Registration Process via EmaraTax Portal
The portal makes the whole process of registration easier:
- Establish or Sign up to EmaraTax Account.
- Open Taxable Person Dashboard.
- Initiate Registration
- Give Business information and upload the documents.
- Apply and Wait to get FTA Approved.
Upon this approval, your business will be registered as an Excise Tax in the UAE. It is also important to keep your account up to date and make proper returns in good time. Need help registering? FTA registration can be done by our professionals.
Method Of Calculations
Example:
Suppose an organization also imported the energy drink of the import price of AED 10 per can and the rate is 100,
the Excise Tax = AED 10 x 100% = AED 10 per can.
Therefore, the post-tax retail price will be AED 20.
How to Calculate Excise Tax in the UAE
To calculate the amount, apply the relevant rate to the retail selling price, import value, or production cost, whichever is higher.
Example:
If a company imports an energy drink with an import value of AED 10 per can and the rate is 100%,
the Excise Tax = AED 10 × 100% = AED 10 per can.
Thus, the retail price after tax becomes AED 20.
What Are the Excise Tax Rates in UAE
| Product Category | Rate |
|---|---|
| Carbonated Drinks | 50% |
| Energy Drinks | 100% |
| Tobacco and Tobacco Products | 100% |
| Electronic Smoking Devices and Tools | 100% |
| E-liquids Used in Vapes | 100% |
| Sugar-Sweetened Drinks | 50% |
The FTA uses a tiered volumetric model to determine tax based on product quantity or sugar content.
What Documents Are Required for Excise Tax Registration in UAE
Businesses must provide:
- Trade License and Certificate of Incorporation
- Tax Registration Number (TRN) or VAT TRN
- Customs Numbers for importers
- Passport and Emirates ID of the authorized signatory
- Articles of Association or Partnership Agreement
- Bank Account Details for payments
- Supporting Documents
Registered businesses must also collect and pay due taxes, submit monthly returns, and maintain detailed records for audit purposes.
FAQs on Corporate Tax in UAE 2025
What is Excise Tax in the UAE and which goods are subject to it?
Who is required to register for Excise Tax in Dubai?
Businesses that produce, import, or stockpile excise goods in the UAE must register with the FTA.
What documents are needed for the registration in the UAE?
Trade license, Emirates ID, passport copy, customs number, bank details, and incorporation documents.
How can a business register for Excise Tax in Dubai?
Through the FTA portal by creating an account, filling in details, and submitting required documents.
What is a Tax Registration Number (TRN) and when is it issued?
A TRN is a unique number assigned by the FTA after successful registration.
Are there any exemptions or special zones for Excise Tax in the UAE?
Yes, businesses operating in approved Designated Zones may receive exemptions under strict FTA regulations.
How does a business comply with Excise duty obligations after registration?
By filing monthly returns, paying taxes on time, maintaining records, and ensuring all goods have proper documentation.
Contact farahatco.com today and get your business registered today.
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