The UAE's government has announced a 100% tax on tobacco products and energy drinks, as well as a 50% tax on carbonated beverages.
Non-alcoholic drinks will rise in price from 1.5 to 2.25 dirhams, while the price of a pack of cigarettes will grow from 8 to 16 dirhams.
The so-called ‘sin tax’ will be part of a broader value-added tax on goods and services that will come into effect on January 1, 2017.
Last weekend, people bought goods at old prices. However, not all stores have raised prices since October 1. In accordance with the provisions of the law, the retailer is not responsible for the tax if the goods were received before the law came into force.
The UAE decided to introduce a 5% VAT in 2018 to revive its economy. In addition to the UAE, the tax will be introduced by Saudi Arabia on January 1, 2018. Another four nations, Bahrain, Kuwait, Oman and Qatar will follow suit during the year.
