The sugar tax on soft drinks will go ahead as planned, it was announced by the UK government yesterday.
In his budget plans, Chancellor of the Exchequer Philip Hammond said that the levy would go ahead, even though the soft drinks industry was reducing the sugar content of its products.
Revenue raised – originally expected to be more than £500 million (US$610m) – would be used to fund school sports and healthy living programmes.
The tax on the soft drinks producers will in effect add 8p to the 70p price of a can of regular Coca-Cola.
The proposal is for a zero levy on added-sugar levels of less than 5g per 100ml of beverage, 18p for between 5g and 8g/100ml and 24p for 8g/100ml and above.
“I can confirm today the final rates of 18 and 24 pence per litre for the main and higher bands respectively,” said Hammond in his announcement.
“But producers are already reformulating sugar out of their drinks, which means a lower revenue forecast for this tax.
“This is good news for our children.
“And in further good news for them, I can confirm that we will nonetheless fund the Department for Education with the full £1 billion we originally expected from the levy this Parliament, to invest in school sports and healthy living programmes.”
The British Soft Drinks Association’s director general Gavin Partington said that sugar content in drinks had already been cut by almost a fifth.
“Given current increases in the cost of goods, we’re surprised the Treasury wishes to put more pressure on businesses and raise prices for hard-pressed consumers,” said Partington.
“It’s also ironic that the tax hits the soft drinks category, which has led the way in helping consumers reduce sugar intake – down nearly 18 percent since 2012. We are also the only sector with a calorie reduction target for 2020.
“We support the need to address the public health challenge the country faces, but it’s worth bearing in mind that there is no evidence taxing a single product or ingredient has reduced levels of obesity anywhere in the world.”
Following the introduction of the levy in 2018 drinks such as Irn Bru (10.5g per 100ml) would face an increase similar to that on Coke as would Red Bull (11g per 100ml), Dr Pepper (10.3g per 100ml), Lucozade (8.7g per 100ml) and Old Jamaica Ginger Beer (15.2g per 100ml).