UAE to introduce minimum taxation price for e-cigarette and vape liquids from September 1

The UAE government plans to implement a minimum price for e-cigarette and vape liquids, effective from September 1, under its "sin tax" rules. The Ministry of Finance announced that the minimum excise price for these items will be Dh1 per millilitre. This minimum excise price will be utilized in calculating the tax, regardless of the retail price.

Consequently, even if a liquid is sold at a price lower than Dh1 per millilitre, such as Dh40 for a 60ml bottle, it will be taxed as if it were priced at Dh60. The Ministry stated that this decision aims to strengthen the effectiveness of the excise tax system and ensure compliance with UAE tax laws. The tax plan also seeks to promote health.

Vaping and e-cigarette liquids are among several tobacco and smoking-related products subjected to a 100% excise tax. Existing excise prices for cigarettes, water pipe tobacco, and ready-to-use tobacco products will remain unchanged. The UAE implemented excise taxes, or sin taxes, on harmful products in 2017, including smoking products and high-sugar beverages, later expanding the program.

A global study in 2024 revealed that three quarters of smokers believed vaping had at least the same health risks as traditional cigarettes. Dr Hassan Razein, a pulmonologist, noted that both smoking and vaping are detrimental to health and suggested further research into vaping's hazards. The Ministry of Finance and the Federal Tax Authority reinforced their strategy with a new pricing system for drinks in January, linking tax rates to sugar content levels per 100ml.