Advice on excise duties
Following the introduction of excise duties in the United Arab Emirates in 2017, all persons dealing with certain products deemed harmful to human health and the environment will have to pay a tax to the government. The excise law applies to products described in the excise goods category, including tobacco, energy drinks, carbonated beverages, etc.
BESTAXCA is one of the leading Excise Tax Consultancy Services In Dubai, providing excise advice and assisting companies with tax audits and tax compliance. By using the appropriate tax advisory services, you can ensure that the excise duties filed are correct and submitted to the tax authorities within the deadline set by the tax authorities.
Excise duty is a form of indirect tax levied on specific goods, called excisable goods, which are usually harmful to human health or the environment. Excise duties were introduced in the United Arab Emirates in 2017.
The purpose of introducing excise duties is to reduce the consumption of unhealthy and harmful goods and to provide the government with revenue that can be used to provide useful public services. Ultimately, consumers have to pay more for goods that are harmful to human health or the environment.
According to Decree No. 7 of the 2017 UAE Federal Law on Excise Taxes, it is mandatory for businesses to register for excise taxes. The deadline for registration of companies was 30 November 2019 and the deadline for registration of stocks is 15 November 2019. January 2020.
Taxable persons who deal with excisable goods, such as tobacco products, aerated drinks and energy drinks, are advised to engage the services of an auditing firm to provide expert advice on excise matters.
BESTAXCA is one of the leading providers of accounting, tax and bookkeeping services, offering its clients excellent advisory services on UAE excise taxes and ensuring that clients comply with tax laws.
Who needs to register for excise duty?
Companies operating in the following sectors are required to register for excise duty.
imports of excise goods into the United Arab Emirates
The production of excise goods when they are released for consumption in the UAE.
Warehousing of excise goods in the United Arab Emirates in certain cases.
The warehouse operator responsible for supervising the warehouse or designated excise area.
Rights of a person subject to excise control in relation to excise duty liability in the United Arab Emirates
During the tax control procedure, the taxable person has the following rights –
to observe the procedure while the auditor is taking the documents
To obtain the return of the documents if the auditor has removed them after the completion of the tax assessment.
Request and obtain confirmation from the auditor of the removal of any item or document.
Goods to be registered as excise goods
Carbonated beverages, including all carbonated beverages except unflavored carbonated water.
Energy drinks, include any beverage marketed or sold as an energy drink containing stimulants that provide mental and physical stimulation.
Tobacco and nicotine products
Electronic smoking devices and appliances.
Liquids are used in electronic smoking appliances and devices.
Products exempt from excise duty –
ready-to-drink beverages containing at least 75 % milk or milk substitutes
Baby food/infant food
Beverages are consumed for special dietary reasons.
Beverages are consumed for medical purposes.
Excise duty rate –
According to the Government Decision No. 52 of 2019 on Excise Goods, the excise rates are as follows:
50% for carbonated beverages.
100% for tobacco products
100% for energy drinks
100% for electronic smoking devices.
100 % for liquids used in such appliances and instruments.
50% for all products containing added sugar or other sweeteners.
The new list of excise duties and rates –
50% on sweetened beverages
100% on electronic smoking appliances and devices
100% on liquids used in electronic smoking devices and appliances
Minimum taxable amount –
A minimum price of Dh 0.40 per cigarette and a minimum price of Dh 0.10 per shisha, ready-to-use tobacco or similar product.
Documents required under the Dubai Excise Law (UAE)
According to the UAE Excise Tax Law, a registered taxable person is required to keep the following documents for a period of one year prior to the imposition of excise duty
Accounts and supporting documents for all excise goods/products imported, manufactured or stored.
Evidence of excise goods sold outside the UAE.
Evidence of excise goods exported outside the UAE.
Detailed reports of physical inventories held by taxable persons.
Accounts of loss or destruction of excise goods.
Tax documents regarding the tax payable on excise goods imported/produced by the taxpayer in the UAE.
Tax documentation on excise goods purchased or produced for the purpose of holding inventory.
Tax certificates for withholding and remittance of tax on excise goods sold outside the UAE.
Report the actual excise goods held by the taxpayer, by value and quantity.
Data on the average monthly inventory held by the taxable person.
Provide average monthly sales data for each type of excise goods.
Data on excise goods produced by the taxable person.
Data on excise goods purchased by the taxable person outside the UAE (imports).
Data on excise goods produced by the taxable person, broken down by item.
Data on excise goods imported by the taxable person, broken down by item.
Data on excise goods sold on the spot by the taxable person, broken down by item.
Data on excise goods sold (exported) outside the UAE by the taxable person, broken down by item.
Data on excise goods dispatched from a particular region.
Data on companies and retailers to whom the taxable person sells excise goods.
Enforcement and penalties
The Tax Administration has the right to audit taxpayers and impose penalties for non-compliance with the law.
The FTA database is directly connected to the customs administration and the excise tax list has commodity codes for taxable goods that can be easily identified.
Once excise duties are imposed on new goods, importers will not be able to clear any dutiable items unless they are registered with the FTA.
Failure to register for excise duty will result in a fine of Dhs20,000.
Failure to register excess inventory of existing dutiable items by January 15, 2020, by December 1, 2019, may result in a penalty of Dhs20,000.
BESTAXCA Excise Tax Advice in Dubai
BESTAXCA offers a wide range of excise advice services in Dubai including tax planning, document verification, tax assessment, etc. The excise advice services offered by BESTAXCA are listed below.
Excise Tax Planning and Advisory Services
GST Planning and Programming Services BESTAXCA experts help our clients manage their GST and report to them on options to mitigate the impact of GST.
Tax advisors and consultants are available to help taxpayers manage their excise taxes and advise on available options.
BESTAXCA experts review all GST-related documents and assess whether they meet the requirements of UAE tax law.
Assessing tax calculations
BESTAXCA specialists verify the tax calculated by the taxpayer and ensure that the tax calculated is accurate.
Performing inventory counts
The BESTAXCA specialist conducts an inventory count on a specific date to verify the accuracy of the physical inventory kept by the taxpayer.
BESTAXCA specialists train company employees on tax audits to prepare them for future tax audits.
Excise Tax Registration Support Services
BESTAXCA professionals provide unlimited support to our clients, guiding them through the entire tax registration process without any hassles.
Excise Tax Compliance Services
BESTAXCA experts analyze all tax-related documents to ensure that they are tax compliant and initiate further action.
Ensure the accuracy of tax reports for excise tax audits
BESTAXCA experts review excise tax documents, returns, and reconciliations and ensure timely submission of excise tax returns for excise tax audits by the FTA BESTAXCA experts can help you maintain and comply with your tax records in accordance with the tax laws to avoid penalties and save money and effort Our tax experts support and guide companies through the excise tax registration process and provide systematic excise tax consulting services for UAE tax compliance. We can guide you through the entire tax process and help your business grow by providing better strategies.
BESTAXCA Accounting & Bookkeeping Services LLC also handles CFO services, audit services, accounting and bookkeeping services, accounting software services, due diligence services and VAT consulting services in Dubai in a timely and professional manner as per the convenience of our outstanding clients.
To avail GST consulting services in UAE or any other related services, please contact us.