Federal Law No. (11) of 1981 Imposing Federal customs duty on imports of tobacco (tax law)

Article (1) 
A federal customs duty shall be imposed on imports of tobacco and its products includ-
ing cigarettes, cigars, etc, whether manufactured or raw materials.

Article (2) 
The tax rate shall be determined at (70%) Seventy Percent of the good’s price, calculat-
ed on the basis of its delivery at the port of arrival in the United Arab Emirates, in the 
event it is imported from abroad.  
A tax rate of (70%) Seventy Percent of the g ood’s manufacturing cost, in the event it was 
manufactured, or its manufacturing was completed in the State, while taking into ac-
count any tax that may have been imposed on the materials included in its manufac-
turing.  
The exports of such goods outside the State shall be exempted from the said tax.

Article (3) 
Without prejudice to the provisions of the second paragraph of article (2), the goods 
stipulated in article (1) shall be temporarily exempted from tax if its import was for the  
Federal Law No. (11) of 1981  Imposing Federal customs duty on imports of tobacco  2 
 purpose of re -exportin g thereof outside the State in their original condition.  
It is conditional for such exemption that the importer pays to the competent authority a 
cash deposit or provides a bank guarantee of the amount of the applicable tax and to 
re-export the goods withi n one year from the date of such import. In the event of failure 
to re -export such goods within one year, the tax shall become immediately payable.  
  
Article (3) BIS  
50% (Fifty percent) of the revenues from the above referenced Tax shall be paid to the 
Min istry of Finance and Industry, and the remaining 50% (Fifty percent) shall be paid to 
the local government within which the tax was collected at one of its ports on within 
which the goods were manufactured. The Ministry of Finance and Industry shall ap-
poin t financial controllers at sea, air, and land ports in the State to monitor and imple-
ment the provisions of this Law.

Article (4) 
The Ministry of Finance and Industry shall, in cooperation with the local customs de-
partment in every emirate, collect the tax as provided by this Law.

Article (5) 
The tax imposed hereunder shall be without prejudice to the local customs duties and 
taxes levied or to be levied in the future, until the federal laws in connection with cus-
toms unity among th e emirates are issued.  
Exemptions or tax discounts as set out in economical cooperation and double taxation 
agreements shall not apply to the provisions of this Law.

Article (6) 
A person that may avoid or attempt to avoid the payment of the tax levied by  this Law 
shall be punished by imprisonment for no later than six months and/or a fine two times 
the applicable tax, and in both events to confiscate the subject goods. If such goods 
cannot be confiscated, such person shall pay the same value of such goods .  
Federal Law No. (11) of 1981  Imposing Federal customs duty on imports of tobacco  3 
 Any other violation of the provisions of this Law or its executive bylaw shall be pun-
ished by a fine of AED 500 maximum.  
All the above without prejudice to any severer penalty set out in any other law.

Article (7) 
The executive bylaw of this Law shall b e issued under a resolution by the Minister of 
Finance and Industry, in particular, such executive regulation shall indicate:  
a. The Rules to be followed upon the calculation of the tax;  
b. Such bodies allocated to collect the tax and the rules of such collection;  
c. Any tax calculation, collection or other forms as required executing the provi-
sions of this Law and its executive regulation.

Article (8) 
This Law shall come in force from the date of issue hereof and shall be published in the 
Official Gazette . 
 
 
 
  
Khalifa Bin Zayed Al Nahyan  
The President of the United Arab Emirates  
 
 
Issued by us in the Presidential Palace in Abu Dhabi on  
 12 Shabaan 1401 Hijri,  
corresponding to 14.6.1981