Manufacturers expect a decrease in the prices of “analyzed drinks”

Refreshments and beverage companies in the local market began preparing to implement the decision of the Ministry of Finance and the Federal Tax Authority, which begins in force at the beginning of next year 2026, amending the mechanism of applying the selective tax to the beverages, so that the value of taxes is linked to the level of sugar in the product, so that the tax rate decreases whenever the proportion of sugar in the product decreases.

Officials of food and drink manufacturers told «Emirates Today» that the companies have already started the process of reformulating their main drinks, to reduce their sugar rates, and to offer more or low -sugar -free products that are free from their various brands.

They explained that amending the mechanism of applying the selective tax and linking it to the amount of sugar in the product was a basic requirement for manufacturers, instead of the fixed percentage of the sale price, noting that this achieves a positive impact on consumer decisions, and supports the choice of low -sugar -informed drinks, which in turn leads to increased production and factories.

And they expected a low price of drinks low sugar after the start of the tax application, noting that the price of sugar represents a significant percentage of the cost of production.

In detail, the CEO of the United Food Company, Fathi Al -Khayari, told Emirates Today: “The amendment of the mechanism of imposing a selective tax on the beverages, so that the value of taxes is linked to the level of sugar in the product, instead of the fixed percentage of the sale price, a basic requirement for manufacturers who demanded to change the previous law, with the aim of achieving a positive impact on consumer decisions, and supporting the selection of drinks Low -sugar later. ”

Al -Khayari affirmed that many moisturizers and drinks in general are ready and ready to produce low -sugar drinks, while the focus will be on the distinction of juice recipes in a way that protects the margins of profit companies.

Al -Khayari expected that the prices of analyzed drinks will decrease, coinciding with the low selective tax, and the application of the new law as of the beginning of 2026.

He pointed out that the price of sugar represents a small and underestimated percentage of the cost of production, in addition to other factors that affect the pricing of drinks, foremost of which is the cost of marketing, and the requirements for putting drinks on the shelves in the major and medium sales outlets (supermarkets).

For his part, Wael Ismail, Vice President of the Pepsico Company for Institutional Affairs in the Middle East, North Africa and Pakistan, said that “the company has already started the process of reformulating its main drinks, so that at least two -thirds of the sales of its drinks contains 100 calories or less than sugars added for each share (12 ounces), in light of the announcement of the Ministry of Finance and the Federal Tax Authority, amending the mechanism of application of the selective tax on Drinks, by linking the value of taxes to the level of sugar in the product.

He affirmed, “The company currently has new plans to enhance innovation, meet advanced health standards, and to keep pace with consumer preferences, focus on reducing added sugar, creating a wider wallet of health options, as a strategic priority for them within regional markets, in cooperation with the regulatory authorities in the state, nutrition experts, retailers, and strategic partners, to design achieve solutions to achieve solutions A positive and local and regional effect.

He added that the company is currently seeking to offer more or low -sugar -free products, through its various brands in the market, to ensure the availability of healthy options suitable for everyone, without prejudice to taste, quality, and the pleasure of experiment.

Ismail welcomed the decision of the Ministry of Finance and the Federal Tax Authority, describing it as in line with the company’s strategy that focuses on investing in creating products, and reformulating them to reduce the percentage of added sugar, indicating that the new decision is a strong boost for the company’s efforts in this direction.

He explained that the company’s regional research and development teams are working to expand their portfolio of low or empty drinks, as well as providing components and developing products that are converged with consumer preferences and regulatory requirements.

Ismail also valued the efforts of the UAE government keen to develop and update its policies according to the needs of consumers, and in a manner that ensures the availability of healthy options in line with the vision of “We Emirates 2031”, pointing out that “Pepsico” supports the ambitious goals of that vision, and puts consumers at the forefront of its priorities, and also supports all policies that enable conscious health decisions.

He believed that the decision is greatly motivated to follow healthy patterns, supports sustainable innovation within the sector, and enables consumers to make more conscious options, which is something that Pepsico has always supported through transparency and commitment to placing clear posters, responsible marketing, and diversifying the portfolio of its products.

In the same context, the entrepreneur, the executive director of a company operating in the food and beverage sector, Mohamed Salem, said that linking the value of the selective tax to the level of sugar in the product was a fixed demand for manufacturers during the past years, indicating that this step comes in the interest of consumers, and the interest of drinking and juices in general.

He explained that the lower the percentage of sugar, the price decreases, and thus the consumer’s demand for the purchase of low -sugar drinks increases, which leads to increased production and increasing the profitability of the factories in the food sector, agreeing that the price of sugar constitutes a percentage of the cost of production, and therefore, any reduction in the amount of sugar will contribute to reducing the cost of production accordingly, which is in the interest of the consumer financially and healthy.

He pointed out that many companies in the country have already started the process of reformulating their main drinks by reducing the percentage of sugar used and offering new products that are low in sugar, which is in the interest of consumers, and is commensurate with supporting the healthy lifestyle in the country.

---

“Gradient volumetric model”

Both the Ministry of Finance and the Federal Tax Authority announced, last July, the amendment of the mechanism of applying the selective tax to the beverages, by moving to what is known as the “gradient volumetric model”, which links the value of the tax imposed on each liter of the analyzed drink with the amount of sugar in every 100 ml, the higher the sugar content in every 100 ml, the value of the tax on the liter, contrary to the exhorted proportions Currently applied to these drinks.

The amendment came within the framework of the state’s efforts to enhance public health, reduce the consumption of highly sugar products, and motivate manufacturers to reduce sugar ratios when producing drinks.

The announcement of this policy also came within a pre -emptive approach that aims to grant suppliers, importers and concerned authorities a period of preparation for the next stage, and this includes the modernization of their internal systems, the examination of the composition of their products, and the update of their records with the Federal Tax Authority, in line with the requirements of the developed model, until the issuance of legislation regulating the application mechanism formally, as the updated mechanism is set at the beginning of the year 2026.