UAE sets a minimum Excise Price of AED 1 per millilitre for e-liquids from 1 September 2026

What changed in detail

Cabinet Decision No. 137 of 2026 on the Excise Price for Tobacco Products and Liquids used in Electronic Smoking Devices and Tools was issued on 24 July 2026 and is effective from 1 September 2026. It is made under Federal Decree-Law No. 7 of 2017 on Excise Tax and Cabinet Decision No. 197 of 2025.

Article 2 requires the Excise Price to be determined under Article 11 of Cabinet Decision No. 197 of 2025, provided that it is not less than AED 0.4 per cigarette, AED 0.1 per gram of water pipe tobacco, ready-to-use tobacco and other similar products, and AED 1 per 1 ml of liquids used in electronic smoking devices and tools.

Article 1 defines the categories. Cigarettes covers all cigarettes, whether normal or electrically-heated. Liquids used in Electronic Smoking Devices and Tools covers all liquids used in such devices and tools and the like, whether or not containing nicotine.

Article 3 repeals Cabinet Decision No. 55 of 2019 on Excise Price for Tobacco Products, together with all provisions conflicting with the new Decision. Article 4 provides for publication in the Official Gazette and for effect from 1 September 2026. The English text published in the Federal Tax Authority’s legislation library carries the note that it is not an official translation.

What it means

This is a floor under the tax base, not a change to the excise rate. The rate on tobacco and on electronic smoking liquids is untouched; what changes is the minimum price the tax is calculated on, so a product priced below the floor is taxed as though it were priced at the floor.

The new part is e-liquids. Cabinet Decision No. 55 of 2019 covered tobacco only, so liquids had no minimum and were taxed on their designated retail price — cheap, high-volume bottles were taxed cheaply. At AED 1 per millilitre a 60 ml bottle carries at least AED 60 of excise base before any retail price is considered, which reprices the large-format end of that market rather than trimming it.

Systems need the per-unit basis, not just a percentage: cigarettes per stick, tobacco per gram, liquids per millilitre. And with the 2019 decision repealed, the old tobacco figures should be retired rather than kept alongside.