With effect from 1st October 2017, there will be a significant increase in the prices of sugary drinks and tobacco products in the UAE, following the implementation of new excise tax. The excise tax will lead to a 50 % increase in the prices of sugary soft beverages and 100% increase in the prices of colas, energy drinks and cigarettes.
By levying this tax, the Government aims to discourage smoking and push people to make healthier choices. “This tax is set to discourage the consumption of products that negatively impact the environment and, more importantly, people’s health,” said, Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai, UAE Minister of Finance, and Chairman of the Federal Tax Authority.
Despite the steep rise in prices, many families living in Dubai have welcomed the new excise tax on sugary drinks and other products. Karen, a south African expat mother living in Dubai Marina, has expressed her happiness over the move. “I see a lot of parents allowing their children to consume fizzy drinks as a treat. Everyone knows that these soft drinks are loaded with sugars and extremely unhealthy, yet they are part of most special occasions, birthday parties, weekend movies and dinners. If these soft drinks become more expensive, I think people would avoid buying them so often and also switch to more healthy options,” she said.
Neeta, another expat mom living in Dubai, believes that the new tax will bring about a change. She has been working as a primary school teacher for more than 12 years and she often finds children bringing sugary juices to school. She has written to parents many times asking them to avoid sending fried snacks and high calorie drinks in the lunch box, but most parents don’t have a problem with beverages labelled as “juice” and “fruit drink”, she says. Although most parents know that fizzy drinks are not good for children, they still believe that other sweet drinks are ok and possibly nutritious too. She’s positive that the new taxes will finally discourage many parents from buying packaged fruit drinks as they would no longer be a cheaper alternative to fresh fruit juices.
Lina Ahmed, who lives in Mirdiff with her husband and 2 children says the excise tax on cigarettes and beverages will not prevent her husband from smoking or drinking coke every day, but it might reduce his consumption to a large extent. “If the cost is going to double, he won’t be able to spend as much on his cigarettes, coke and coffee anymore. We simply cannot afford that kind of additional expense, and that’s why has no other option but to cut down the number of cigarettes he smokes in a day. I think this is good for his overall health as he’s already overweight and has blood pressure problems. I am very happy and hopeful,” she says.