UAE begins collecting 'sin tax' on tobacco, energy drinks

The United Arab Emirates has begun collecting new “sin” taxes on tobacco products, energy drinks and soft drinks.

Beginning today, tobacco and energy drinks will be taxed at 100 per cent, while sugary drinks will be taxed at 50 percent.

The new tax push comes as the UAE and other oil-rich Gulf nations have struggled with low global energy prices. The UAE will also start collecting a 5 per cent value-added tax on certain goods in January.

Introduced as a way of discouraging the consumption of goods that damage people’s health, the excise move has been welcomed by many, including health professionals.

The tax affects specific “excise” goods that are produced in the UAE, imported into it or stockpiled in the Emirates, as well as excise goods released from a designated zone.

The shop manager of a small supermarket chain in Dubai said cigarettes, carbonated drinks and energy drinks are some of the biggest sellers in his store.

It will be interesting to see if this tax changes that sales trend. I don’t know if people will want to pay double the price for the likes of a fizzy drink or energy drink anymore.