The Gulf's sugar tax of 2026: what changed on 1 January
The United Arab Emirates and Saudi Arabia stopped taxing sweetened drinks by price and began taxing them by sugar. What that means for a drink, an importer and a shelf.
By The Pop Journal4 min read
The 60-second sip
- Since 1 January 2026 the UAE and Saudi Arabia charge excise on sweetened drinks per litre, by how much sugar they contain.
- It replaces a flat 50 per cent of the price.
- In the UAE a drink with less than 5 g of sugar per 100 ml pays no excise; from 5 g it pays 0.79 dirhams a litre; from 8 g, 1.09 dirhams.
- The tier is decided by a certified sugar figure, so the lab report has become a trade document.
For six years the two largest markets in the Gulf taxed sweetened drinks the simple way: half the price again. A cola and a lightly sweetened iced tea paid at the same rate. On 1 January 2026 that ended. Both countries moved to a system agreed at Gulf level, in which the tax follows the sugar.
The three steps
| Sugar per 100 ml | Excise in the UAE |
|---|---|
| Less than 5 g | None |
| 5 g to less than 8 g | 0.79 dirhams a litre |
| 8 g or more | 1.09 dirhams a litre |
Saudi Arabia's steps are drawn at the same two lines, 5 g and 8 g, under rules published on 29 December 2025. Importers should take the riyal rates from the Saudi tax authority's own notice.
What it changes for a drink
Under the old rule, sugar made no difference to the tax. Under the new one it is the only thing that does. A drink just above a line pays; the same drink reformulated to sit just below it pays less, or nothing. Every maker selling into the Gulf now has a reason to count grams.
What it changes for an importer
- The sugar figure has to be certified. In the UAE, makers, importers and stockpilers need a conformity certificate for sugar content.
- The tax is per litre, so it falls hardest on cheap, large packs and lightly on small, premium ones.
- A low-sugar drink can now be priced against full-sugar ones with a tax advantage it did not have before.
The rest of the Gulf
The model was agreed by the Gulf Cooperation Council for all six members. Bahrain, Kuwait, Oman and Qatar set their own dates: check each country's tax authority before you price a shipment.
Where this comes from
- Gulf News: from 1 January, how the UAE's sugar tax changes
- EY: Saudi Arabia to implement a new excise method for sweetened beverages
- KPMG: amendments to Saudi Arabia's excise tax regulations
- Gulf News: why the UAE and Saudi Arabia are taxing sweetened drinks
Last checked against these sources on .