How to Calculate Duties and Taxes on Imports to United Arab Emirates is a critical step for international trade compliance. Import duties and taxes are levied based on the product's classification (using the 12-digit HS Code), its customs value, and the country of origin. The official customs authority is the Federal Authority for Identity, Citizenship, Customs & Port Security (ICP). For low-value shipments, a duty and effective tax de minimis threshold of 300 AED applies in Dubai, meaning shipments valued below this amount are generally exempt from duty and tax collection at the border.
The UAE follows the Gulf Cooperation Council (GCC) Common Customs Tariff, which sets the standard import duty rate at 5% for most goods. However, specific products like tobacco and alcohol are subject to significantly higher rates (e.g., 50% to 100%). To accurately calculate import tax in United Arab Emirates, the first step is correct classification using the 12-digit import tariff code, which became the standard in 2025, replacing the previous 8-digit structure. This detailed classification is essential for determining the exact duty rate and any applicable restrictions. The customs valuation basis is the Cost, Insurance, and Freight (CIF) value, meaning the duty is calculated on the total cost of the goods, plus the cost of shipping and insurance to the UAE port of entry.
The process to calculate duties and taxes on imports to United Arab Emirates is centered on the CIF valuation method and the application of two primary import charges: Customs Duty and Value Added Tax (VAT). The standard customs duty is 5% ad valorem (of the CIF value). The customs valuation basis, CIF, is crucial because it includes the cost of the goods, the freight charges, and the insurance costs in the dutiable value. This is the figure upon which the import duty is calculated.
Value Added Tax (VAT): The UAE imposes a standard VAT rate of 5% on most imported goods. Unlike the customs duty, the VAT is calculated on the duty-inclusive value, meaning the total of the CIF value plus the Customs Duty (and any applicable Excise Tax). This is a key factor when using an import tax calculator United Arab Emirates tool to estimate the final landed cost.
De Minimis Thresholds for Low-Value Shipments: The UAE employs a low-value shipment regime that affects how import duty is calculated in United Arab Emirates for small parcels, particularly for eCommerce. For shipments entering Dubai, the de minimis threshold for customs duties is 300 AED. Shipments with a CIF value below this amount are generally exempt from customs duties. While VAT is technically due on all imports, this de minimis value often acts as the effective threshold for both duty and tax collection for express carriers. It is important to note that Abu Dhabi maintains a higher de minimis threshold of 1,000 AED.
Customs Declaration System: Commercial importers must use the electronic customs declaration system, such as Mirsal 2 in Dubai, to file the import declaration, classify goods using the 12-digit HS code, and pay the calculated customs duties in United Arab Emirates. Accurate documentation, including the commercial invoice and Certificate of Origin, is mandatory to ensure correct tariff application and to claim preferential rates under trade agreements.
Determine the Customs Valuation Basis (CIF): Calculate the total value by adding the Cost of Goods (C), the Insurance (I), and the Freight (F) charges. This is the Dutiable Value.
Determine the Customs Duty Rate: Classify the goods using the mandatory 12-digit import tariff code (HS Code) to find the applicable duty rate (typically 5%, but higher for restricted goods).
Calculate Customs Duty: Multiply the Dutiable Value (CIF) by the Customs Duty Rate. If the CIF value is below the 300 AED de minimis threshold (for Dubai), the duty is typically zero.
Calculate VAT: Add the Customs Duty (and any applicable Excise Tax) to the Dutiable Value (CIF) to get the VAT Base. Multiply the VAT Base by the standard 5% VAT rate.
Low-Value Shipment (Dubai): CIF Value is 250 AED. Since 250 AED is below the 300 AED duty de minimis threshold, Customs Duty is 0 AED. The shipment is generally cleared without duty or tax collection.
Standard Commercial Shipment: CIF Value is 10,000 AED. Standard Duty Rate is 5%. Customs Duty = 10,000 AED * 5% = 500 AED. VAT Base = 10,000 AED (CIF) + 500 AED (Duty) = 10,500 AED. VAT Due = 10,500 AED * 5% = 525 AED. Total Import Taxes = 1,025 AED.
Misclassifying Goods: Using an incorrect 12-digit HS Code can lead to incorrect duty rates, fines, or shipment delays.
Ignoring CIF Valuation: Failing to include freight and insurance costs in the declared value (CIF) will result in customs penalties for undervaluation.
Overlooking Emirate-Specific Rules: Assuming a single de minimis threshold across the UAE; the low-value shipment rule varies between Emirates (e.g., Dubai's 300 AED vs. Abu Dhabi's 1,000 AED).
The UAE’s customs framework includes several special provisions. Goods imported into a designated Free Trade Zone (FTZ) are considered outside the customs territory and are exempt from customs duties. Duty is only applied if the goods are subsequently moved from the FTZ to the UAE mainland. Furthermore, goods originating from a GCC member state (e.g., Saudi Arabia, Bahrain) are exempt from customs duties under the GCC Common Customs Law, provided the importer furnishes a valid Certificate of Origin. Certain products, such as energy drinks and tobacco, are subject to additional Excise Tax, which is calculated before VAT.
The standard import duty rate in the UAE is 5% of the Cost, Insurance, and Freight (CIF) value of the goods, as per the GCC Common Customs Tariff.
Yes, Value Added Tax (VAT) is charged on most imports at a standard rate of 5%. It is calculated on the total value, which includes the CIF value plus any applicable Customs Duty and Excise Tax.
The de minimis threshold for customs duties on low-value shipments entering Dubai is 300 AED. Shipments with a CIF value below this amount are generally exempt from duty and tax collection.
The UAE uses the CIF (Cost, Insurance, Freight) method as the customs valuation basis. This means the customs duty is calculated on the total cost of the goods, plus the cost of shipping and insurance to the UAE border.