Tax on sugary soft drinks comes into force to combat child obesity
Around 60% of the UK population is overweight, and sugary soft drinks account for around 20% of the sugar consumed by children.
Friday 6 April 2018 07:39, UK
A tax on sugary soft drinks has come into force, with the Treasury having slashed its forecast for the revenue it will raise.
The Soft Drinks Industry Levy, announced by former chancellor George Osborne in 2016, was originally expected to raise £520m in its first year, with the money to be spent on school sport.
That figure has now been revised down to £275m after major manufacturers cut the amount of sugar in popular brands to avoid the tax.
The levy will see drinks containing five grams of sugar per 100ml taxed at 18p per litre, and those with more than eight grams per 100ml taxed at 24p per litre.
The Treasury says the levy will reduce childhood obesity by encouraging manufacturers to cut the sugar content of their products, or to sell smaller amounts.
Major brands, including the manufacturers of Lucozade-Ribena and IRN-BRU, responded by cutting the sugar content of their main products and in some cases replacing them with sweeteners.
Coca-Cola has also cut the sugar in a number of its brands, but is not altering its Classic Coke recipe, meaning a can could cost around 10p more.
Around 60% of the UK population is overweight, with approximately one in-four people obese, and sugary soft drinks account for around 20% of the sugar consumed by children.
Public health bodies say the tax will help tackle levels of obesity, particularly in children.
"We hope it will have two impacts," Deborah Shipton of NHS Health Scotland told Sky News.
"One, there will be reformulation, meaning there is less sugar added to drinks, and where there isn't we know that price matters, and that it will reduce the amount of cheap sugary food that is around."
In Scotland the reformulation of IRN-BRU has been controversial.
Manufacturers AG Barr cut the amount of sugar from the equivalent of eight teaspoons per can to four, but a petition opposing the change has attracted more than 50,000 signatures.
Ryan Allen, who launched the petition, said: "I think they have sold their brand short and they should have had the backbone to stick with the recipe. It's been made for 117 years and it is part of our heritage."
AG Barr says the majority of its customers support the change.
"The vast majority of our drinkers want to consume less sugar so that's what we're now offering," a spokesperson said.
"IRN-BRU remains a sugary drink as the sugar in a can was reduced from 8.5 teaspoons to 4. A can of IRN-BRU produced previously had just under 140 calories and today has around 65 calories."
Coca-Cola said brands including Fanta, Sprite, Dr Pepper and Lilt will not be subject to the tax after being reformulated.
A spokesperson said: "Coca-Cola Classic is one of the few brands that will be subject to the new tax as we have decided not to change the recipe.
"Consumers tell us not to change it and we believe they should be able to choose a Coca-Cola Classic if that's the drink they want."
Public Health England welcomed the tax, citing new figures which it says show that a child has a rotten tooth removed every 10 minutes in England.
Evidence of the effectiveness of sugar taxes elsewhere in the world is mixed.
Mexico saw an initial reduction in the amount of sweet drinks sold when it introduced a levy, but estimates of the long-term impact of the tax are based on projections of sales had it not been introduced.
There are concerns too that a "pleasure tax" on sugar will disproportionately affect the poorest people.
Public health officials point out that deprivation is a factor in the prevalence of obesity, with the least well-off most likely to be overweight.