Advice on excise taxes
The introduction of excise tax in the UAE in 2017 means that all individuals trading in certain products considered harmful to human health and the environment will have to pay tax to the government. The excise tax law applies to products classified as taxable goods, such as tobacco, energy drinks and carbonated beverages.
CDA is one of the leading accounting and bookkeeping firms providing Excise Tax Consultancy Services In Dubai, assisting companies with tax audits and tax payments. By using the right tax advisory services, they can ensure that the excise taxes reported are correct and submitted to the authorities within the deadlines set by the tax authorities.
Advice on excise tax
Excise tax is an indirect tax on certain goods called consumables that are often harmful to human health and the environment. In 2017, excise taxes were introduced across the UAE.
The purpose of the excise tax is to reduce the consumption of unhealthy and harmful goods and generate revenue for the government to spend on beneficial public services. Ultimately, consumers are forced to pay more for goods that are harmful to human health and the environment.
Under the UAE federal law “Excise Tax” Decree No. 7 of 2017, businesses are responsible for registering for excise tax. The deadline for business registration is November 30, 2019. The deadline for stock registration is January 15, 2020.
Taxpayers engaged in excise tax related activities such as tobacco products, carbonated beverages and energy drinks are advised to authorize accounting firms to provide professional advice on excise tax issues.
CDA is one of the leading providers of accounting, tax and bookkeeping services in the UAE, offering excellent excise tax advisory services and ensuring clients’ compliance with tax laws.
Who needs to register for GST?
Businesses engaged in the following sectors need to register for GST
Import of goods into the UAE
Production of goods to be placed for consumption in the UAE
Storage of goods in the UAE in certain circumstances
Supervising warehouses of goods or warehousemen in designated areas
A person’s rights in the UAE excise tax audit
Supervision of the process when the auditor takes the documents out of the country
To retrieve documents if they are taken by the auditor after the tax audit is completed
Request the auditor to delete records and documents and obtain receipts
Products that require registration of goods
Carbonated beverages (including all carbonated beverages other than unflavored carbonated water)
Energy drinks (including all drinks sold as energy drinks) containing stimulants that cause mental or physical stimulation
Tobacco and nicotine products
E-cigarettes and devices
Liquids used in e-cigarette machines and devices
Beverages with added sugar
Products exempt from excise duty
Ready-to-drink beverages containing 75 percent or more milk or milk replacer
Powdered milk and baby food
Beverages consumed for special dietary purposes
Beverages drunk for medical purposes.
Excise tax rates
According to Cabinet Decision No. 52 of 2019 on excise tax, the excise tax rates are as follows
50% for carbonated beverages.
100% for cigarettes.
100% for energy drinks.
100% for e-cigarettes.
100% for liquids used in such devices and appliances.
50% discount on all products containing sugar or other sweeteners.
List of new excise taxes and rates
50% discount on sugary beverages
100% charge on electronic smoking devices and appliances
100% inspection of liquids used in electronic cigarettes
Minimum price for tax registration -.
The minimum price must be $0.40 per cigarette and $0.10 for luxury, ready-to-use cigarettes and similar products.
Records required to be kept under the Dubai Crude Oil Law in the UAE
According to the UAE Excise Law, the tax registrar is required to keep the following records for a period of one year prior to the imposition of excise duty
Account and supporting documentation for all goods imported, manufactured, and stored
Proof of goods sold outside the UAE.
Supporting documentation for goods exported outside the UAE.
A detailed description of the physical inventory held by the taxable person.
A description of the goods in case of loss or destruction.
Tax records relating to goods imported/manufactured in the UAE by the taxpayer.
Tax records relating to goods purchased or manufactured for storage purposes.
Certificates withheld and submitted in respect of goods sold outside the UAE.
A statement of the value and quantity of goods stored by the tax return preparer.
An informative statement of the tax return preparer’s average monthly inventory.
An informational statement regarding the average monthly sales of each consumer good.
An informative statement detailing the goods produced by the taxable person.
A detailed description of the goods purchased by the taxable person from outside the UAE (imported goods).
Details of the items of goods products manufactured by the taxable person.
Item particulars of the excisable goods imported by the taxable person.
Item details of excisable goods sold locally by the taxable person.
Details of excisable items sold (exported) by the taxable person outside the UAE.
Item particulars of excisable goods released from the designated area.
Details of companies and retailers to whom the taxpayer sells GST products.
Tax Compliance and Penalties
The FTA has the right to audit taxable businesses and impose penalties on businesses that do not comply with the law.
The FTA’s database is directly connected to customs, and items subject to excise tax have an item code and can be easily identified.
With the application of the excise tax on newly added items, importers will not be able to clear taxable items if they have not registered with the FTA.
Failure to register for excise duty by the deadline will result in a fine of Dhs. 20,000.
Failure to register excess existing stock of taxable items as of December 1, 2019 by January 15, 2020 may result in a fine of Dhs 20,000.
CDA’s GST Advisory Services in Dubai
CDA provides various GST advisory services in Dubai, including tax planning, document verification, and tax calculation assessment. Below are the excise tax advisory services offered by CDA.
GST Planning and Consulting
CDA’s professional staff helps clients manage GST by making them aware of opportunities to mitigate GST impacts.
Verification of All Documents
CDA’s experts verify all documents related to goods and assess whether they meet the requirements of UAE tax laws.
Evaluation of tax calculations
CDA experts check the tax calculated by the taxpayer to ensure that the tax calculated is accurate
Conducting an Inventory
CDA professionals conduct an inventory on a specific date to verify the accuracy of the physical inventory kept by the taxpayer
Conduct training for employees
CDA specialists provide training to company staff on tax audits to ensure they are prepared for future tax audits.
Support services for goods registration
CDA professionals provide unlimited support to clients and ensure the success of the entire tax registration service process.
Excise Tax Compliance Services
CDA professionals analyze all tax-related documents to ensure tax compliance before taking further action.
Ensuring Accuracy of Tax Reports for Excise Tax Investigations
CDA professionals review excise tax records, returns, and reconciliations to ensure that excise tax returns are submitted in time for FTA excise tax audits. CDA professionals help you maintain tax records in compliance with tax laws, avoid penalties, and reduce costs and labor.
Our tax professionals provide systematic GST advisory services in the UAE to assist and guide companies through the GST registration process and to comply with tax laws. We help our clients grow their business by guiding them through the entire tax process and providing them with better strategies.
CDA Accounting & Bookkeeping Services LLC also provides CFO services, audit services, accounting and bookkeeping services, accounting software services, due diligence services and VAT advisory services in Dubai at the convenience of our excellent clients. We handle these services in a timely and professional manner.
If you are interested in availing GST advisory services or any other related services in UAE, please contact us.