For excise tax purposes, wasted or deficient goods located within a designated zone are considered as consumed, which leads to an excise tax liability.
However, there is an exception applicable to such goods as specified in the Public Clarification EXTP007 “Excise Goods which are deficient or missing and the process for the destruction of Excise Goods within a Designated Zone” recently published by the UAE Federal Tax Authority (“FTA”).
Provided the warehouse keeper follows certain processes specified in the Public Clarification, as an exception, the excise tax is not due on wasted or deficient goods. For example, destruction is subject to prior approval by the FTA.
Source
- Aurifer
- gov.ae
