On 23 May 2019, the UAE Cabinet issued Decision No. 33 (the Decision) on Administrative Penalties for Violations relating to Marking Excise Goods.
The Decision clarifies Decision No. 42 of 2018 on Marking Tobacco and Tobacco Products and introducing the Digital Tax Stamp (DTS). The DTS scheme requires tobacco and tobacco products importers and UAE based manufacturers to apply control markers (stamps) and codes to all tobacco products.
Decision No. 33 sets out a range of violation penalties for non-compliance with the DTS scheme, as follows:
| Description of violation | Administrative penalty (AED) |
|---|---|
| a person possessing or handling designated excise goods that do not carry stamps | - 50,000; and
- 50% of the excise tax due on the designated excise goods |
| a person, knowingly, allowing his premises to be used for the sale of designated excise goods in the UAE that do not carry a stamp | - 25,000 for the first violation; and
- 50,000 in case of repetition |
| a person altering stamps affixed to designated excise goods, or being engaged in overprinting any stamp affixed to designated excise goods | - 50,000; and
- 50% of the excise tax due on the designated excise goods |
| a person failing to report the movement of designated excise goods via the electronic system defined in Cabinet Decision No. 42 of 2018 | - 20,000 per incident |
| a person failing to comply with the requirements to securely store stamps as determined by the Federal Tax Authority | - 50,000 per incident |
| a person failing to comply with time limits to return unused stamps to the Federal Tax Authority | - 50,000 per incident |
| a person failing to affix stamps to designated excise goods in the manner and location specified by the Federal Tax Authority | - 25,000 for the first violation; and
- 50,000 in case of repetition |
| a person conducting unauthorized trading, swapping, selling or otherwise supplying of stamps | - 25,000 for the first violation;
- 50,000 in case of repetition |
| a person re-using stamps which have previously been used on a designated excise good | - 50,000; and
- 50% of the excise tax due on the designated excise goods |
As from 1 May 2019, tobacco products without the required DTS will not be permitted for importation into the UAE. And, as from 1 August 2019, tobacco products will not be allowed to be held out for sale, imported or produced in the UAE unless they carry the required DTS.