The UAE Ministry of Finance has announced that updated excise tax rules on sugary drinks will take effect on January 1, 2026, in line with Gulf Cooperation Council (GCC) standards. The current flat 50 percent tax will be replaced with a tiered system, where drinks with higher sugar content will face higher taxes, while lower-sugar beverages will be taxed at a reduced rate. The new structure aims to encourage manufacturers to lower sugar levels and provide consumers with healthier options. The amendments also offer legal clarity for producers and importers, including provisions for tax adjustments on unsold stock. Overall, the update seeks to make the tax system more efficient, fair, and flexible, while supporting public health goals such as reducing obesity and diabetes.
