Lack of low-cost cigarettes in UAE to help smokers kick the habit


UAE tax, UAE VAT, UAE tax in cigarretes, tax on sugary drinks

Dubai - Cigarettes and sugary drinks to cost more from December.


Angel Tesorero

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Published: Thu 24 Oct 2019, 7:41 PM

Last updated: Fri 25 Oct 2019, 9:11 AM

Smokers are looking to reduce the number of cigarettes they light up or kick the butt altogether with new pricing requirements announced by the government on Tuesday.
From December 1, the minimum price of a cigarette will be 40 fils or Dh8 for a pack of 20, according to a directive issued by the Federal Tax Authority (FTA).

"This means that a pack of 20 cigarettes, previously sold at Dh4, must now be priced at a minimum of Dh8. The new Dh8 retail price includes VAT (value-added tax) and excise tax," a tax expert explained to Khaleej Times.

A quick of survey of some convenience stores revealed that the cheapest pack of cigarette available is priced at Dh5. This will go up to Dh8 come December 1.

Thomas Vanhee, partner at Aurifer Middle East Tax Consultancy and an affiliate professor of tax law, said: "A pack of 20 cigarettes previously sold at Dh10 will be in excess of the minimum (Dh8) price. If the seller does not increase the price, the Dh10 retail price should remain as it is already inclusive of 48 fils VAT and Dh4.76 excise tax."

The FTA stressed that the increase would "protect consumers and the community from products that damage public health and the environment".

Indian expat Mohammed Abdulrahman, who consumes at least three packs a week, said he will have to cut down on cigarettes due to the move. He said he can get a pack of 20 cigarettes in Karama at Dh4.50. However, because of the stipulated minimum price, he will have to shell out an extra Dh3.50 per pack, which will amount to Dh10.50 per week or Dh42 a month.

Filipino expat Paul Santillan said he previously switched to a low-cost cigarette after the government first introduced the excise tax on tobacco products. "Now there will be no cheaper alternatives as all cigarettes will be priced high," he said.
Doctors hail move
Doctors, meanwhile, have praised the move as a step in the right direction for promoting community health and well-being.

Dr Cherian Thampy, medical oncologist at NMC Specialty Hospital Abu Dhabi, said: "Smoking is strongly correlated with lung cancer. It is responsible for developing lung cancer by 94 per cent and the risk of lung cancer is 24 to 36 times higher in smokers than in non-smokers, while the risk is 3.5 per cent in passive smoking.

"The additional tax on harmful products is a small price to pay for the larger good of our society," he stressed.
Pricing changes explained

> Dh8: Will be the minimum price of a 20-cigarette pack. This means that a cigarette pack currently available for Dh4 will cost double from December 1

> Dh25: Will be the minimum price per 250 grammes of waterpipe tobacco and similar products.

Sin tax

> 100% excise tax on tobacco and tobacco products; electronic smoking devices and liquids; and energy drinks
> 50% excise tax on carbonated beverages and sweetened drinks

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