Excise Tax on Ginger Ale in the UAE

Ginger ale's tax follows its sweetness: full-sugar versions usually hit AED 1.09 per litre, diet versions AED 0. Article 7 of Cabinet Decision No. 197 of 2025 places ginger ales in one of the five excise categories created by Cabinet Decision No. 197 of 2025, which took effect on 1 January 2026 and repealed the old Cabinet Decision No. 52 of 2019.

The tax is charged once — at import, at manufacture, or when the goods are released for consumption — and it is paid by whoever is the registered importer, producer or stockpiler at that moment. There is no registration threshold: handling even a single unit of an excise good in one of those three capacities creates the duty to register.

Downstream sellers — wholesalers and retailers buying goods on which excise has already been paid — do not pay excise again and generally do not need to register. Their duty is provenance: buy from registered suppliers and keep the invoices.

Sweetened drinks are not taxed as a percentage of price. Under Article 10 of Cabinet Decision No. 197 of 2025, the tax is a fixed amount per litre of the finished drink, set by sugar bands: AED 1.09 per litre at 8 grams or more of sugar or other sweeteners per 100ml, AED 0.79 per litre from 5 grams up to under 8 grams, and AED 0 per litre below 5 grams or where only artificial sweeteners are used.

For ginger ales, the band is read off the sugar content of the drink as consumed. Naturally occurring sugar counts: Article 10(3) adds natural sugars to added sweeteners when the band is set. Concentrates, powders and gels are banded on the final made-up drink, following the producer's dilution guidelines — or the FTA's mechanism where guidelines are missing or proven wrong.

You must hold an FTA-accepted laboratory report proving the sugar quantity and sweetener type. Without it, Article 13(4) taxes the drink at the highest band — AED 1.09 per litre — until you prove otherwise.

Before the first shipment or production run, the business must register for excise tax on EmaraTax and receive its Tax Registration Number. At import, the importer of record declares the goods and the excise is assessed at customs clearance; manufacturers account for tax as goods are produced.

After that, the rhythm is monthly: one tax period per calendar month, with the return and the payment both due within 15 days of month-end. A month with no excise activity still needs a nil return — silence is penalised as late filing (AED 1,000 first time, AED 2,000 on repetition, under Cabinet Decision No. 40 of 2017 as amended (Administrative Penalties)).

Late payment accrues 14% per annum on the unpaid tax, charged monthly on the unpaid tax. Late registration itself costs AED 10,000. Keep every record — import papers, production logs, price declarations, lab reports — for five years.

The most expensive error is trading before registering — importing or producing ginger ales unregistered combines the AED 10,000 late-registration penalty with back-tax and 14% late-payment interest. The second is misclassification: assuming ginger ales falls outside the categories without checking the customs codes the Minister specifies.

Third, for price-based goods, is a weak or missing RSP declaration — if the FTA cannot accept your designated retail sale price, it substitutes its own, usually higher. For sweetened drinks, the equivalent failure is trading without an accepted lab report, which defaults the product to the AED 1.09 top band.

Finally, businesses forget the monthly nil return in quiet months, and they destroy records before five years. Both are entirely avoidable penalties.