From November 1: UAE’s Federal Tax Authority to implement Phase 2 of digital tobacco tax

Abu Dhabi: The Federal Tax Authority (FTA) has completed its preparations to implement phase two of the “Marking Tobacco and Tobacco Products Scheme” to include Water Pipe Tobacco (known in Arabic as “Mu’assel”), as well as electrically-heated cigarette plugs, starting from November 1, 2019.

In a press statement issued on Sunday, the Authority asserted that phase two builds on the success of its predecessor, where the sale and possession of any type of cigarette that doesn’t bear the Digital Tax Stamps was banned across local markets starting from last August 2019.

The scheme serves to protect consumers from commercial fraud and low-quality products, on top of combatting tax evasion, the Authority noted.

The FTA explained that all products marked with the Stamps and included under the Scheme are electronically monitored from the manufacturing facility and until they reach the end consumer to ensure that all Excise Taxes due on tobacco and tobacco products have been settled.

The Authority called on businesses that supply Water Pipe Tobacco and electronically heated cigarette plugs to comply with the Scheme in order to avoid any violations or interruption to their operations.

FTA Director General Khalid Ali Al Bustani asserted that the ‘Marking Tobacco and Tobacco Products Scheme’ – which the UAE was the first in the region to implement – has helped upgrade inspection and control procedures at customs ports and markets, rendering them more effective in preventing the sale of counterfeit products that have not met their tax requirements.