UAE Federal Tax Authority Conducts Record Inspections, Seizing 17.6 Million Non-Compliant Goods in H1 2025
The Federal Tax Authority (FTA) has announced a significant escalation in its oversight and enforcement efforts in 2025, conducting a record-breaking 85,500 field inspections across the UAE during the first half of the year.
According to a statement issued on August 11, 2025, the figure represents a 110.7% increase compared to the same period in 2024, when just over 40,500 inspections were conducted. These campaigns, carried out in collaboration with other government bodies, are aimed at ensuring tax compliance, protecting consumer rights, and combating tax evasion in local markets.
Taxes and Fines Surge by 86%
As a direct result of these intensified inspections, the FTA collected Dhs357.22 million in taxes and fines between January and June 2025 — an 86.29% increase from the Dhs191.75 million collected in the same period last year.
The authority noted that its inspection teams covered a wide range of markets and sectors, with a particular focus on detecting violations in the excise tax segment.
Major Seizures of Non-Compliant Products
One of the most striking results of the campaign was the seizure of over 17.6 million non-compliant excise goods, marking a 144.44% increase compared to the 7.2 million items confiscated in H1 2024.
This included:
- 11.52 million packs of non-compliant tobacco products — more than double the 5.52 million packs seized in the first half of 2024 (+108.7%). Many of these products lacked the mandatory Digital Tax Stamps and were not registered in the FTA’s electronic system.
- 6.1 million non-compliant beverages — including soft drinks, energy drinks, and sweetened beverages — representing an increase of more than 250% from the 1.74 million units seized in H1 2024.
Leveraging Technology to Combat Tax Evasion
Sara AlHabshi, Executive Director of Tax Compliance in the Tax Affairs Sector at the FTA, emphasized the importance of technology in the Authority’s enforcement strategy.
"Our intensified inspections are a critical part of our mission to combat tax evasion and protect consumers from non-compliant products that fail to meet UAE market standards," she said.
The FTA has adopted advanced digital technologies to enhance the efficiency of inspection operations, enabling inspectors to identify, track, and intercept smuggled goods in real time.
"These technologies allow us to respond more quickly and thoroughly to violations, helping to ensure that non-compliant products are removed from the market," AlHabshi added.
Ongoing Market Oversight
The FTA reaffirmed its commitment to maintaining a continuous inspection program throughout the remainder of 2025. Working alongside strategic partners, the Authority aims to further strengthen market control mechanisms, promote transparency, and ensure governance across all tax-related procedures.
"This helps prevent the sale, storage, or distribution of products that violate UAE tax laws," AlHabshi noted, adding that public cooperation is essential to sustaining compliance levels.
Why This Matters for Businesses in the UAE
The unprecedented inspection drive sends a strong message to businesses operating in the UAE: compliance with tax laws — especially excise tax requirements — is non-negotiable.
Companies dealing in tobacco products, sugary beverages, or other excise goods must ensure that their products:
- Carry the correct Digital Tax Stamps
- Are registered in the FTA system
- Comply with all labelling and import requirements
Failure to do so can result in severe financial penalties, product seizures, and potential legal consequences.
Conclusion
The FTA’s record-breaking enforcement activity in H1 2025 highlights the UAE’s zero-tolerance approach to tax evasion and non-compliance. With more than 85,000 inspections, hundreds of millions in recovered taxes and fines, and tens of millions of illicit products seized, the message is clear: businesses must adhere to tax laws or face significant consequences.
As technology-driven enforcement expands, market players should expect greater scrutiny and be proactive in meeting tax obligations.
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