His Highness Sheikh Hamdan bin Rashid Al Maktoum, Chief and Minister of Finance of Dubai and Chairman of the Federal Taxation Bureau of the Free Trade Agreement, has issued a decision that the Tobacco and Tobacco Products Labelling Scheme will be implemented on e-cigarettes and water-cigarettes from 1 November 2019.

The plan also determines the date of issuance of the Digital Seals of the Tax System and their storage standards.

The Regulatory Authority explained that the plan would help monitor local markets and customs ports, prevent the sale of contraband and unpaid goods, and combat commercial fraud. The packaging of tobacco products will be printed digitally and registered in the FTA database.

The seal stores digital information and can be read through special devices to verify that the product has paid taxes.

In a press statement issued, the FTA stated that it supported its cooperation with relevant entities in efforts to collect taxes, combat tax evasion and implement unified procedures to ensure transparency and protect taxpayers'rights and interests.

The decision of Free Trade Agreement No. 2 of 2019 on the implementation of the tobacco and tobacco product labelling scheme consists of five articles. Determine November 1, 2019 as the date on which importers or producers of water and electronic cigarettes can order digital seals.

The decision also stipulates that from 1 March 2020, the United Arab Emirates will prohibit the import of goods subject to consumption tax without a digital seal. From 1 June 2020, the Emirates will no longer allow the supply, transfer, storage or possession of goods subject to consumption tax without a seal.

According to the decision, digital seals must be properly stored before they can be affixed with designated goods in accordance with minimum security requirements. Personnel responsible for the custody of seals shall provide information, data and records as required by FTA to confirm that the regulations have been implemented.

The FTA also stated that the decision was part of its strategy to expand the scope of the Tobacco and Tobacco Product Labelling Scheme to cover all tobacco products, including imports and exports, local production and distribution, and to track them electronically from production to consumers to ensure full compliance with tax obligations.