Abu Dhabi, 28 March 2019: The Federal Tax Authority (FTA) announced that the first batches of cigarette packs bearing the FTA-approved Digital Tax Stamps have reached local UAE markets; the packs can be electronically tracked to verify that the Excise Tax due has been paid.
The Authority asserted that as of May 1, 2019, importing cigarette packs not bearing the Digital Tax Stamps will be banned, while selling or distributing unmarked cigarette packs is set to be prohibited as of August 1, 2019.
In a press statement issued today, the Authority explained that as of January, the Digital Tax Stamps became available to order from the system operator and to place on cigarettes packs before leaving the factory to hit the shelves across local markets.
FTA Director General His Excellency Khalid Ali Al Bustani noted that concerned businesses around the country have overwhelmingly taken the initiative to order the Digital Tax Stamps and register them in the database. The Digital Tax Stamps carries digital information that can be read with a special device, allowing inspectors to verify that Excise Taxes due on all locally traded cigarettes has been settled. H.E. pointed out that the scope of the system will be gradually expanded to include all tobacco products, which would then be electronically tracked from production and until they reach the final consumer to ensure compliance with Excise Tax obligations, and combat tax evasion and commercial fraud.
The Federal Tax Authority received large numbers of orders for the Digital Tax Stamps and directed the company tasked with operating the system to deliver them to the manufacturers in order to apply them on cigarettes supplied to UAE markets. The Authority urged all suppliers, manufacturers, and traders in local markets to avoid stocking large quantities of cigarettes not bearing the Digital Tax Stamps in preparation for the ban on trading unmarked cigarette packs in all UAE markets. The FTA clarified that as per Cabinet Decision No. (42) for 2018 on Marking Tobacco and Tobacco Products, any Person owning or trading cigarettes that don’t bear the Digital Tax Stamp will incur penalties as of August 2019.