Riyadh: Saudi Arabia will introduce a new tiered selective tax system on sweetened beverages starting January 1, 2026. The update follows a recent decision by the Gulf Cooperation Council’s Financial and Economic Cooperation Committee to revise how such taxes are calculated across the GCC.
Industry and Mineral Resources Minister Bandar Alkhorayef said the change resolves long-standing concerns raised by manufacturers and was achieved through coordinated efforts involving the Ministry of Finance, the Zakat, Tax and Customs Authority, and the Ministry of Health. He noted that the new framework aims to protect public health by discouraging high sugar consumption while still enabling the beverage industry to innovate.
Under the revised policy, taxes will be applied according to the amount of sugar per 100 milliliters, replacing the current flat 50 percent tax on retail price. The definition of sweetened beverages includes ready-to-drink products as well as powders, concentrates, gels, and extracts.
The GCC-wide sugar tax reform is designed to encourage companies to reduce sugar levels, promote healthier consumer choices, and address health issues such as obesity and dental problems.
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