It’s not long until we enter 20206. While the countdown is officially on, the UAE is entering the New Year packed with major lifestyle changes. We’re talking more efficient systems, eco-friendly upgrades and more! From 1st January onwards, expect changes such as a sugary drink tax and a total ban on single-use plastics…there’s still more! The ‘Year of the Family’ will reshape everything from your routine grocery errands to your morning coffee runs. Businesses are also in for a shake-up with updated VAT rules, mandatory e-invoicing, and tighter banking security as SMS OTPs slowly disappear. Social media content creators, you’ve got a new deadline to watch out for as well! If you want to start the new year prepared, here are the key rules that will roll out in 2026! Keep reading to learn how they’ll impact residents, businesses, tourists, and content creators across the UAE.
Also Read: 8 Major Changes Coming To UAE In 2026
1. Sugary-Drinks Tax Changes
From 1st January 2026 onwards, the Ministry of Finance will introduce updated excise tax rules for sugar-sweetened beverages. The UAE will move from a flat 50% tax to a tiered system based on sugar content. This means that drinks with higher sugar content will face higher taxes, while lower-sugar beverages will be taxed at a reduced percentage. This aligns the UAE with the GCC’s unified model, encourages beverage companies to reduce sugar levels, thereby giving consumers more low-sugar options. The ultimate goal is to promote healthier choices while keeping the tax system more efficient and internationally aligned.
2. Say Goodbye To Single-Use Plastics
The New Year will see a complete ban on importing, producing, or trading a wide list of single-use plastic products. As part of the plastic reduction plan launched in 2024, the complete ban on single-use plastics is the next step towards an eco-friendly lifestyle. Dubai will prohibit single-use cups, lids, cutlery, food containers, and plates (so, say goodbye to takeout containers!). This follows earlier bans on plastic bags in 2024 and styrofoam products in 2025. The move aims to reduce waste, encourage the use of reusable alternatives, and support the country’s long-term environmental strategy.
3. New VAT Rules For Businesses
If you run a business, then this rule is for you. From the New Year, a new federal decree revising parts of the VAT law will come into effect. This rule is designed to simplify compliance and ensure alignment with global standards. Under this rule, businesses will no longer need to issue self-invoices under the reverse charge mechanism. Instead, they will only need to retain regular supporting documents such as contracts, invoices, and records. A new five-year deadline for claiming refundable VAT means any claims made after this period will no longer be accepted. These changes are set to reduce admin work, prevent long-pending claims, and offer businesses clearer certainty over their tax position.
4. SMS & Email OTPs To Be Phased Out
Your online shopping/payments are about to get a whole lot more secure. Under new UAE Central Bank directives, SMS and email one-time passwords will be fully phased out by March 2026. Your banks will shift to app-based authentication, using secure ID verification methods built directly into mobile banking apps. This update comes in as SMS and email OTPs are vulnerable to SIM swapping, phishing, and interception. As a result, phasing this out will reduce fraud risk and add stronger layers of security for both domestic and international transactions.
5. Social Media Creators Need An Official Licence
Content creators, you might want to set a reminder for this deadline. The UAE Media Council has extended the deadline for all content creators, influencers, and advertisers to obtain the Advertiser (Mu’lin) Permit to January 31, 2026. Anyone who promotes, reviews, or advertises any product, service, or content on social media, even if unpaid, must apply for this permit. The licence helps regulate the fast-growing advertising sector by improving content quality and protecting consumers. The permit is valid for one year and is renewable. However, this is the best part, creators get the first three years free! Applications are available through the UAE Media Council website.
6. Businesses Must Switch To E-Invoices By 2026
A new decision is set to modernise business operations and streamline financial processes nationwide! The Ministry of Finance has issued new decisions outlining how and when companies must switch to the UAE’s new Electronic Invoicing System. Under this rule, businesses will be required to issue, exchange, and store invoices electronically for all B2B and B2G transactions. The pilot phase with full implementation begins on the 1st July, 2026, for a selected group of businesses. Under this system, benefits include faster, more secure invoicing and reduced paperwork and errors. This is also an economical option, as it lowers operating costs and improves tax and financial reporting efficiency.
