Kuwait has taken a major step toward introducing excise taxation after the Cabinet approved a draft decree-law concerning the Unified Excise Tax Agreement of the Gulf Cooperation Council (GCC) and its amendments. The measure has been formally referred to His Highness the Amir Sheikh Meshal Al-Ahmad Al-Jaber Al-Sabah for final approval.
The proposed selective tax framework targets four primary product categories:
- Tobacco and its derivatives: Subject to a 100% proposed tax.
- Energy drinks: Subject to a 100% proposed tax.
- Carbonated beverages: Anticipated to face a 50% levy.
- Sweetened beverages: Taxed based on total sugar content under evolving GCC rules.
This initiative aligns with broader GCC commitments to harmonize regional indirect taxation, promote public health by curbing the consumption of harmful goods, and diversify national revenue away from oil dependence. Officials estimate that the tax could generate approximately KD 200 million annually in non-oil revenue.
