UAE's Sweet Regulations: Tackling Sugary Drinks

UAE Sugar Tax from 2026: New Regulations on Sugary Drinks

From early 2026, the United Arab Emirates will usher in a new era in the taxation of sugary drinks. The previously uniformly applied fixed tax rate will be replaced by a detailed "graduated volume-based model," which determines the tax rate based on sugar and sweetener content. The goal is clear: to reduce the population's sugar intake, encourage healthier choices, and thereby improve public health indicators in the long term.

What Counts as a Sweetened Drink Under the New Regulations?

The new legislation clearly defines what is considered a sweetened drink. These are products to which natural sugar, added sugar, artificial sweeteners, or other sweeteners are added. These can be ready-to-drink beverages, concentrates, powders, gels, extracts, or any form that becomes consumable when diluted with water or otherwise.

It is important to distinguish that drinks containing only natural sugars (e.g., 100% fruit juice) are not subject to the tax, while drinks made with artificial sweeteners fall under a 0% excise tax. Therefore, the tax rate applies only when added sugar or other sweeteners present in the drink exceed the thresholds set by the regulation.

Categorization Based on Sugar Content

The new regulations effective from 2026 categorize sweetened drinks into three main categories:

• High sugar content drinks: contain at least 8 grams of sugar and/or sweeteners per 100 ml.

• Medium sugar content drinks: contain 5–8 grams of sugar and/or sweeteners per 100 ml.

• Low sugar content drinks: contain less than 5 grams of sugar and/or sweeteners per 100 ml.

Energy drinks remain in a separate category, still subject to a 100% excise tax regardless of their sugar content, and are not covered by the new graduated model.

Without Certification, Beverages Automatically Considered High Sugar Content

The Federal Tax Authority (FTA) clarified that if a sweetened drink does not hold a valid UAE Certificate of Conformity, it will automatically be classified under the high sugar content category until a certified laboratory test report confirms a lower sugar and sweetener level.

This is particularly important for manufacturers, importers, and distributors, as a missing certification could result in significant financial disadvantages for the parties involved.

Early Preparation and Online Certification Application

The FTA is already encouraging the stakeholders, including manufacturers, importers, and warehouse operators, to start analyzing their products and submit the necessary documentation for certification as soon as possible. The certification can be requested online and includes the product's total sugar and sweetener content — including natural, added, and other sweeteners — as well as whether the drink contains only artificial sweeteners.

The laboratory report to be submitted with the certification must come from an accredited testing lab recognized by the Ministry of Advanced Industry and Technology (MoIAT).

Goals and Impact of the New Tax Model

The main goal behind the new regulation is to curb excessive sugar consumption as part of the UAE's health policy strategy. Rising obesity and diabetes rates are a global issue, and the Emirates is no exception. The volume-based, sugar-content-linked taxation may incentivize manufacturers to reduce the sugar content of their products or switch to artificial sweeteners, which are not subject to excise duty.

Consumers, with their price sensitivity, are likely to turn away from high sugar content drinks and choose cheaper, less sugary alternatives.

What Will Happen to Carbonated Drinks?

Carbonated drinks, previously categorized separately, will no longer receive a standalone classification in the future. Classification based solely on sugar content will be the sole criterion, meaning, for example, a sugar-free soda — even if carbonated — may fall under the 0% tax rate, while a sugary carbonated drink may be taxed based on the appropriate sugar content level.

What Should Market Players Pay Attention To?

Those involved in excise taxation must prepare to register their products with the authorities, update their records, and comply with the upcoming regulation. The FTA emphasized that timely preparation will make the transition smoother. All information on calculating the tax, categorizing products, and determining sugar and sweetener content is available on the tax authority's website.

Final Thoughts

The UAE's new sugar tax regulation is considered a milestone in the region. It not only aims to improve public health but also encourages companies to innovate. The biggest winners will likely be those manufacturers who recognize the opportunities in change early and begin transforming their product portfolios now. Consumers will then have a broader choice, making more conscious and healthier decisions.

(Source of the article: Based on a statement from the Federal Tax Authority (FTA).)