The scheme will be extended to include all tobacco products
The Emirati Federal Tax Authority (FTA) announced that the new digital tax stamp scheme for tobacco products came into effect as of 1 January.
The scheme will be extended to include all tobacco products, exported and domestically produced tobacco, to guarantee full compliance with paying the selective tax on tobacco products.
The FTA highlighted tobacco firms shall be working under the new scheme to avoid penalties and losing its business, pointing out that the new system supports inspection and supervision at the customs outlets and markets to prevent selling any smuggled products.
The digital stamps or seals will be printed on the packages of tobacco products and will be registered on the FTA’s database to ensure that taxes on these products are being paid, state-run agency Emirates News Agency (WAM).
Khalid Ali Al Bustani, director general of the FTA, said that the digital tax stamp system will be implemented starting from 1 January, as tobacco producers and importers will be allowed to request the stamps after getting the authority’s approval.
The stamps will be sealed on the tobacco products’ packages before distribution to the local markets to ensure that the tax on tobacco products is being paid across the UAE, Al Bustani added.
He indicated that importing all kind of cigarettes that have no digital stamps on to the country will be halted as of 1 May.
He also noted that selling any tobacco product with no digital stamp on in the UAE’s markets will be suspended starting from 1 August.
A fine will be imposed on anyone who owns or sells any tobacco products with no digital stamp on in accordance with the Cabinet’s decree number 42 for 2018, the director general said.
This step comes following the introduction of the FTA’s decision number 3 for 2018, he pointed out.
The UAE is the first country in the region to apply this scheme, which aims at combating tax evasion through developed and adequate mechanisms.
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