The United Arab Emirates (UAE) will introduce a new system for calculating excise tax on sweetened drinks from January 1, 2026, the Federal Tax Authority (FTA) has announced.
The tiered-volumetric model will replace the current fixed-rate method and will base tax amounts on the sugar and sweetener content per 100ml of drink. The change comes under Cabinet Decision No. 197 of 2025 on Excise Goods, Tax Rates or Amounts Imposed on Excise Goods, and the Methods of Calculating the Excise Price.
The FTA said the decision “forms part of ongoing efforts to implement the directives of the wise leadership to accelerate the development of a safe and healthy society, by reducing the consumption of harmful goods and mitigating the societal impacts and costs associated with combating non-communicable diseases resulting from consumption patterns that are detrimental to public health.”
How the tiered-volumetric model works for UAE sweetened drinks
The FTA has launched a registration service for sweetened drinks through the EmaraTax platform. The service uses artificial intelligence technologies and will allow producers, importers, and stockpilers to register products under the new calculation method.
From January 1, 2026, all producers, importers, and stockpilers of sweetened drinks must obtain the Emirates Conformity Certificate for Sugar and Sweeteners Content in Beverages from the Ministry of Industry and Advanced Technology website.
Businesses must first obtain laboratory test results from accredited laboratories listed on the National Accreditation Department and Emirates International Accreditation Centre websites.
The FTA warned that beverages without the certificate will be classified as high-sugar sweetened drinks “until a laboratory report is provided proving that its sugar content is below the threshold prescribed for this category.”
UAE sugar tax 2026: High-sugar drinks face AED1.09 per litre levy
Under the new model, sweetened drinks will fall into four categories. High-sugar drinks contain 8 grams or more of sugar and sweeteners per 100ml and face a tax of AED1.09 per litre.
Moderate-sugar drinks contain 5 grams or more but less than 8 grams per 100ml and will be taxed at AED0.79 per litre.
Low-sugar drinks with less than 5 grams per 100ml and artificially sweetened drinks containing only artificial sweeteners or artificial sweeteners plus sugar or other sweeteners of less than 5 grams per 100ml will face zero tax.
The tax will apply to drinks with added sugar or other sweeteners such as honey, whether ready to drink or in concentrate, powder, gel, extract or other forms that can be converted into drinks. Beverages containing only natural sugar with no added sugar or sweeteners will not be taxed.
Carbonated drinks reclassified under new UAE excise tax rules
Carbonated drinks will no longer form a separate category of excise goods. Instead, tax will apply based on sugar and sweetener content and whether they qualify as sweetened drinks.
Energy drinks will continue to be taxed under the current method at 100 per cent of the excise price and will not be subject to the tiered-volumetric model.
For products not ready to drink, such as extracts, powders and gels, manufacturers must provide information on sugar content and serving size, including the number of servings that can be prepared according to label instructions.
The FTA said this is “to avoid any suspension of product’s registration, which could subsequently affect import procedures.”
The FTA issued a clarification in September outlining the changes and has published information on its website about the mechanism, objectives, requirements and methods for determining sugar and sweetener content.
The authority said it has implemented “a comprehensive plan for early awareness of the new mechanism” over recent months.
