UAE Excise Tax: Why Some Products Cost So Much More
· 1 min read · VAT & Tax
If you've noticed tobacco and energy drinks cost dramatically more in the UAE than the sticker price would suggest, excise tax is why — a separate, heavier tax layered on top of standard VAT for specific product categories.
Calculate excise tax on a product
Enter the price and category to see the tax breakdown.
Ad space
What's taxed and at what rate
The UAE applies excise tax to:
- 100% on tobacco products and energy drinks
- 50% on carbonated drinks and other sweetened drinks
This is applied to the product's price before the standard 5% VAT, meaning these products are effectively taxed twice.
Why these specific products
Excise tax exists specifically to discourage consumption of products considered harmful to health — a policy tool used globally, not just in the UAE, often called a "sin tax."
Ad space
Frequently asked questions
Is excise tax the same as VAT?
No — they're separate taxes. Excise tax applies to specific harmful product categories at 50-100%, applied before the standard 5% VAT is added on top.
Don't miss it: Calculate excise tax on a product
Use our free tool and get your answer with real numbers.
Related calculators
Related articles
Ad space