UAE FTA Clarifies Excise Tax Exemptions for Natural Shortages in Designated Zones

• UAE FTA released Public Clarification EXTP011 on July 17, 2025
• Clarification addresses natural shortages of excise goods in Designated Zones
• Effective from July 1, 2025, under Excise Tax Law and FTA Decision No. 6 of 2025
• Normally, shortages are considered a release for consumption, triggering tax
• EXTP011 distinguishes shortages due to natural characteristics as non-taxable
• Criteria for exemption include inherent nature of loss and FTA-approved report
• Declaration must be filed and documentation retained for FTA review
• FTA-approved labs assess natural loss percentages, valid for 12 months
• Losses from negligence or mishandling do not qualify for exemption
• Detailed examples provided in EXTP011 for practical understanding
• Full text of EXTP011 available for further details and impact discussion

Source: mailchi.mp

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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