Saudi Arabia

100% Tax on E-Cigarettes and 50% on All Sweetened Drinks

Saudi Arabia is expanding the excise tax charged on tobacco and soda to include electronic cigarettes and all drinks with added sugar as part of its efforts to boost non-oil revenue.

According to a document issued by the General Authority of Zakat and Tax, all sweetened drinks will be subject to a 50% excise tax. E-cigarettes and their liquids will have a 100% tax.

However, the date of implementation has not yet been announced.

Saudi Arabia began imposing excise taxes in 2017, applying a 50% levy on soda and 100% on energy drinks and tobacco. Separately, the government introduced a 5% value-added tax in January 2018.

The world’s largest crude exporter has introduced several new taxes and fees over the past few years as part of an economic transformation plan.

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