Drinks prices to be based on sugar content under UAE tax ruling

Pricing system aimed at improving public health will start in 2026

About 2.2 million new cases of Type 2 diabetes a year globally have been attributed to sugary drinks. Reuters

Drinks in the UAE will soon be priced depending on the amount of sugar they contain per 100ml under a new amendment to the country's tax laws.

The new pricing system will come into effect from the beginning of 2026, the Ministry of Finance and the Federal Tax Authority (FTA) has confirmed.

The higher the sugar content per 100ml, the higher the tax cost per litre, marking a move away from the current flat fee.

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“This amendment is part of the UAE’s broader efforts to promote public health, reduce the consumption of high-sugar products, and encourage manufacturers to lower sugar levels in their beverages,” the ministry said in a statement released on Friday.

“Unlike the previous model, which was based on product classification, the new system ties the tax rate directly to the level of sugar content, and by extension, to the associated health impact.

“This approach incentivises manufacturers to reduce sugar levels and empowers consumers to make more informed dietary choices.”

The UAE introduced an extra tax on sugar-filled soft drinks in 2017, with experts previously telling The National the move had been a great success, leading to decrease in new diabetes cases reported.

A US study released this year estimated that 2.2 million new cases of Type 2 diabetes and 1.2 million new cases of cardiovascular disease occur each year globally due to sugary drinks.

In the Middle East, they directly contributed to about 15 per cent of diabetes cases, the study by researchers at the Gerald J and Dorothy R Friedman School of Nutrition Science and Policy at Tufts University found. The study was published in Nature Medicine.

Doctors back health drive

Dr Ahmed Abdul Karim Hassoun, consultant endocrinologist at Dubai's Fakeeh University Hospital. Photo: Dr Ahmed Abdul Karim Hassoun

Dr Ahmed Abdul Karim Hassoun, a consultant endocrinologist at Dubai's Fakeeh University Hospital, said the tax strategy would encourage drink manufactures to reduce sugar levels in their products and help support nationwide efforts to cut diabetes rates.

“This is a commendable public health policy. By linking the tax directly to the sugar content in sweetened beverages, we are encouraging manufacturers to reformulate products with lower sugar levels,” Dr Hassoun said.

“This is particularly important in the fight against obesity, metabolic syndrome, and Type 2 diabetes, all of which are on the rise in the region.

“Reducing added sugars in daily consumption can have a significant long-term impact on preventing these chronic conditions.

“Still, to maximise the impact, this measure should be coupled with awareness campaigns to educate the public about the risks of excessive sugar intake.”

Regional strategy

After sugar taxes were introduced by the UAE and Saudi Arabia in 2017, Oman, Bahrain, Kuwait and Qatar followed suit. The move was motivated by the region’s high rates of obesity and diabetes.

Since then, Bahrain has reported the biggest drop in diabetes, from 19.5 per cent of the population in 2011 to 11.3 per cent in 2021. But that success has not yet been replicated in other Gulf nations.

Oman reported an increase in diabetes rates from 10.5 per cent to 13.8 per cent. In Kuwait, 24.9 per cent of people are now affected, up from 20.7 per cent a decade ago.

Mansoor Ahmed, an independent healthcare expert in the Mena region, has previously told The National that using taxation as a means to promote healthier diets was only one piece of the puzzle.

“While sugar tax does reduce calorie intake, it's not a singular solution to these health conditions. Reducing rates may take years or even decades to fully manifest,” he said.