The UAE is set to roll out a new sugar tax policy starting January 1, 2026, changing the way sweetened beverages are taxed across the country.

Under the updated system, taxation will no longer be based on the product category but on the actual sugar content of each beverage. This means drinks with higher sugar levels will face higher taxes, while those with lower sugar content will be taxed less — encouraging healthier choices among consumers.

The Ministry of Finance announced that the new policy introduces a tiered volumetric model aligned with a wider GCC initiative to standardize excise tax on sugar-sweetened beverages (SSBs).

Additionally, producers and importers who have already paid a 50% excise tax on beverages before the changes take effect will be able to deduct part of the previously paid tax if their tax liability decreases under the new model.

The ministry stated that these amendments aim to create a competitive and transparent tax environment, while establishing a comprehensive regulatory framework to ensure smooth national implementation.

This marks a significant shift in the UAE’s approach to sugar taxation — focusing on content over category — as part of broader regional efforts to promote public health and balanced fiscal policy.