Nicotine patches, gums, and sprays were treated the same as tobacco under excise tax laws until now. This made them more expensive and less accessible, which actually discouraged smokers who genuinely wished to quit smoking. Considering this issue, the UAE government has stepped in with a major change.
With Ministerial Decision No. 249 of 2025, effective October 1, 2025, the Ministry of Finance has exempted smoking cessation products from excise tax. This move gives smokers the support they need, removes unnecessary cost barriers, and strengthens the country’s public health vision.
To learn about recent excise tax updates, reach out to our qualified tax agents in the UAE at Tax Gian.
What Does the New Excise Tax UAE Update Include
Ministerial Decision No. 249 of 2025 has clearly indicated that nicotine-based smoking cessation aids are no longer considered tobacco or tobacco products for tax purposes. This decision updates Cabinet Decision No. 52 of 2019, which originally listed excise goods, tax rates, and methods of price calculation.Â
In short, this means that nicotine replacement items, like gum, tablets, patches, sprays, nose drops, and injections, are no longer subject to excise tax. This is good news for businesses involved in the manufacture of such goods. These items, listed under specific HS Codes in Chapter 24 of the GCC Common Customs Tariff, are now officially recognised as therapeutic rather than taxable products. The change reflects a simple principle: quitting aids should not be treated like the habit they are trying to end.
Businesses, which used to pay excise tax on the manufacture of such items, have been given huge relief. There is no need to pay excise tax anymore on some items. Learn from our expert tax agents in the UAE about how it will work and its impact on your business.Â
Purpose Behind the Exemption
This decision is not just a tax update; it’s a public health initiative. The UAE government wants to draw a clear line between harmful tobacco and nicotine-based medical aids that help people stop smoking.
This move also aligns with worldwide public health efforts that encourage smoking cessation and recognise nicotine replacement therapies as crucial ways for harm minimisation.
When It Takes Effect
The exemption has been in effect since October 1, 2025. From that date, all manufacturers, importers, and distributors handling these products must ensure their systems, customs declarations, and records reflect the new excise status.
Any earlier conflicting provisions have been repealed, ensuring there’s no confusion about which products are exempt moving forward.
Our expert tax agents at Tax Gian will help you make necessary amendments in your systems in order to comply with the new UAE excise tax update.
Products Covered Under the Exemption
The decision applies to products that contain nicotine but are used to help people quit smoking. These include:
- Nicotine gums and lozenges
- Nicotine tablets and patches
- Nasal sprays and nose drops
- Nicotine injections
Only items that meet the specified HS Codes under Chapter 24 qualify. Businesses dealing with cessation aids should check these codes carefully to ensure compliance. You can also seek assistance from our tax experts at Tax Gian for this purpose.Â
Who Benefits from the New UAE Excise Tax Update
- Smokers trying to quit:Lower costs make it easier to have access to effective treatment.
- Pharmaceutical suppliers and importers:Simplified compliance and reduced excise documentation.
- Healthcare providers:Easier patient access to medically approved cessation aids.
- Public health authorities:Reinforced progress toward reducing smoking rates nationwide.
The decision supports the UAE’s broader health goals and its aim to reduce smoking-related diseases over the coming years.
Impact on your Businesses
For companies involved in manufacturing, importing, or distributing smoking cessation products, this change brings both relief and responsibility.
They will no longer have to apply excise tax on these items, but they must ensure their product classifications are correct. Incorrect classification could result in penalties or rejection at customs.
Businesses should also review their accounting and tax systems with the help of tax experts, like Tax Gian, to ensure excise returns exclude these products after 1 October 2025.
Broader Health and Policy Vision
By differentiating between harmful and helpful nicotine products, the government is promoting responsible regulation. It also reflects the country’s ongoing commitment to align fiscal measures with health objectives. Similar measures in other countries have helped lower smoking rates and reduce healthcare costs linked to tobacco use. Encouraging smokers to switch to cessation aids instead of continuing to buy cigarettes could save lives, and now, in the UAE, it’s more affordable to make that switch.
How can Tax Gian help?
This move supports the UAE’s public health mission, reduces the financial burden on those trying to quit, and simplifies compliance for businesses. However, businesses must update their accounting and tax systems to align product classification with the new UAE excise tax update. Tax Gian will help you understand the implications of the new Ministerial Decision on your business, assist in updating tax and accounting systems, help in classifying products accurately and ensure 100% compliance with the tax laws.
