Tax evasion and trade in inferior products and counterfeit goods are among the main challenges facing tax authorities around the world, as they are illegal activities that are damaging to health in particular and economies in general.
As part of its on-going efforts to protect consumers from commercial fraud and combat tax evasion with various mechanisms and utilizing the latest technologies, the Federal Tax Authority (FTA) has launched an innovative smart application that can be applied to check on the legality of trademarked tobacco products. The smart application is designed to help consumers detect uncertified tobacco products by scanning the digital tax stamps placed on cigarette packages and tobacco products included in the ‘Marking Tobacco and Tobacco Products Scheme’, which went into effect at the beginning of 2019. The application also aims to ensure that these products meet the standard specifications, are not smuggled, and have been subjected to tax.
The Authority said in a press release issued today that the application has been instigated under the banner, “Monitor yourself, fight fraud”, adding that users can install the app, known as ‘FTA DTS’, on their smart phones via the Apple Store and Google Play.
The FTA explained that the application enables consumers to scan the stamps placed on the tobacco packages or tobacco products to verify and ensure that it is an Authority accredited digital tax stamp. Should the consumer discover that the stamps are not accredited, they can file a report to the FTA directly from the smart application. The Authority will then cooperate with the relevant authorities to take legal actions against violators.
Commenting on the initiative, His Excellency Khalid Ali Al Bustani, Director-General of the Federal Tax Authority, said: “The ‘FTA DTS’ smart application is one of the effective tools that support the ‘Marking Tobacco and Tobacco Products Scheme’, which came into effect at the beginning of 2019 to combat tax evasion, protect public health and reduce the risks to consumers from the inferior products entering local markets.”
H.E. Al Bustani added: “The FTA, through the new application, will offer consumers the opportunity to contribute to the control efforts aimed at protecting the markets from commercial fraud and inferior products, protecting public health, preserving the environment, promoting the concept of community partnership, and eliminating negative practices in local markets.”
H.E. Al Bustani explained: “By using this application, consumers can verify that the digital tax stamps are placed on the tobacco packages and tobacco products to ensure that they are not inferior or counterfeit products, allowing consumers to cooperate with the Authority to combat the illegal trade of tobacco and tobacco products.”
The initiative to launch the ‘FTA DTS’ smart application for consumers of tobacco and tobacco products is part of the FTA’s effort to implement the Cabinet Decision No. (42) of 2018 on Marking Tobacco and Tobacco Products. Phase one of the ‘Marking Tobacco and Tobacco Products Scheme’ came into effect on January 1st 2019, on all types of imported and locally manufactured and traded tobacco products. On May 1st, 2020, the FTA then issued a ban on importing all types of unmarked cigarette packets into the UAE. Following that, on August 1st, 2020, the sale of tobacco products not bearing a DTS was banned across all local markets.
Beginning on November 1st, 2019, the ‘Marking Tobacco and Tobacco Products Scheme’ entered phase two when it became necessary for all producers and importers of all types of water pipe tobacco and electronically heated cigarette plugs to place their orders for Digital Tax Stamps. As of March 1st, 2020, importing any type of these products into the UAE without the Digital Tax Stamps became strictly prohibited. From January 1st 2021, the ban on supplying, transferring, storing, and possession of water pipe tobacco, and electrically heated cigarettes in the UAE that do not carry digital tax stamps will be implemented.