Picture for illustrative purposes only. ARCHIVE

The UAE’s Ministry of Finance has confirmed that the country will implement a revised excise tax system on sugary drinks starting January 1, 2026. In a statement on Monday (October 6), the ministry said the update marks “the completion of proposed legislative amendments to embed the updated excise tax policy into national legislation” and is aimed at promoting healthier lifestyles and aligning with new Gulf Cooperation Council (GCC) standards. The new system adopts a tiered volumetric model, linking the tax directly to the sugar content per 100ml of beverage — a shift from the current flat 50 percent rate imposed since 2017. “The higher the sugar content per 100ml, the higher the tax per litre,” the ministry stated, emphasizing the UAE’s goal to align fiscal policy with public health objectives. This change is expected to have a direct impact on popular sweetened drinks such as colas, energy drinks, and flavored juices. For instance, a 330ml can of cola currently priced around Dh3.50 could see price adjustments depending on its sugar concentration. Under the new model, beverages with lower sugar levels may become cheaper, incentivizing both manufacturers and consumers to make healthier choices. Developed in coordination with the Ministry of Health and Prevention, the policy reflects the UAE’s broader commitment to reducing non-communicable diseases and promoting better dietary habits. The Ministry of Finance, which first announced the revised tax in July, said the system will be implemented alongside a public awareness campaign, giving businesses time to adjust before enforcement. ICA/Expat Media
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