This is the most common question after registration.
Not how much is the tax, but simply: does my product fall under sugar tax or not?
From 2026, this question matters more than ever, because classification of beverages is reviewed more consistently and based on what the product contains, not how it is marketed.
What Sugar Tax Covers in the UAE
Sugar tax in the UAE is part of the Excise Tax system regulated by the UAE Federal Tax Authority.
It applies to specific categories of sweetened beverages. A product does not need to look unhealthy or be marketed as a soft drink to be taxable. The decision is based on composition and use.
Beverages Commonly Subject to Sugar Tax
From 2026, sugar tax generally applies to sweetened beverages such as:
- carbonated soft drinks with added sugar
- non-carbonated drinks with added sugar or sweeteners
- flavored drinks containing sugar
- ready-to-drink beverages with sugar content
- concentrates, syrups, or powders used to prepare sweetened drinks
If sugar or sweetening substances are added, the product should always be reviewed for sugar tax.
Products That Often Cause Confusion
Many businesses assume some products are exempt because of branding or positioning. This is where mistakes happen.
Common examples include:
- flavored water with added sweeteners
- juice drinks with added sugar
- energy or functional drinks
- sweetened iced tea or coffee drinks
- imported beverages with unfamiliar ingredient names
From 2026, classification focuses on ingredients and formulation, not labels such as “natural”, “premium”, or “light”.
What Does NOT Decide Sugar Tax
These factors do not determine whether sugar tax applies:
- marketing claims
- product name
- packaging style
- target audience
- price level
Two drinks can look identical on the shelf and still be treated differently for tax purposes if their ingredients differ.
Why Classification Matters
Incorrect classification can lead to:
- unpaid sugar tax
- backdated assessments
- penalties
- delays at import or audit stage
This often happens when businesses rely on assumptions instead of reviewing ingredients carefully.
A Practical Way to Think About It
The safest approach is simple:
If a beverage contains added sugar or sweeteners, assume sugar tax may apply until confirmed otherwise.
Many businesses use a tool like SugarTaxUAE to explore whether a product is likely to fall under sugar tax and to understand potential impact before importing or pricing.
Practical Takeaway
Sugar tax in the UAE is based on what is inside the beverage, not how it is presented.
If your business imports, manufactures, or sells sweetened beverages, product classification should be reviewed early. From 2026, this clarity avoids surprises and makes compliance easier.