The UK government on Thursday unveiled its plan for a sugar tax on sweetened beverages as it seeks consultations from stakeholders.
The Soft Drinks Industry levy as it would be known seeks to tackle childhood obesity. It was first announced in March as part of the 2016 budget and will come into effect in April 2018.
Meanwhile, industry stakeholders such as the Food and Drink Federation have called for the sugar tax to be suspended due to the fragile nature of the post-Brexit economy. Adding his voice to the opposition, Gavin Partington, Director General of the British Soft Drinks Association, said:
Given the economic uncertainty our country now faces we’re disappointed the Government wishes to proceed with a measure which analysis suggests will cause thousands of job losses and yet fail to have a meaningful impact on levels of obesity.”
He added that the category has ‘led the way in reducing consumers’ sugar intake’, down 16% from soft drinks since 2012. This is being done through reformulation and smaller pack sizes, and in 2015 the industry set a voluntary calorie reduction target of 20% by 2020.
“We’ll share the evidence during this consultation in the hope Ministers reconsider a measure that is both unnecessary and harmful to the economy,” added Partington.
According to the government, the levy will have two bands: one for total sugar content above 5g per 100ml; and a second band for drinks with more than 8g per 100ml.
The British government says its intention is to encourage producers of sweetened beverages to make drinks that are healthier.
Consultations will commence on Thursday and will run for eight weeks, through October 13 2016. The consultation is meant to refine what category of drinks will be levied, how to enforce compliance and how to minimize administrative burdens.
Included in products that would be levied are soft drinks above 5g per 100ml, cordials, squash, soya, almond and coconut milk. Excluded are milk-based drinks, fruit juice and alcoholic drinks.
The government said it estimates by 2050 more than 35% of boys and 20% of girls aged 6-10 are expected to be obese. The projected health cost to the national healthcare system is more than £6bn
The government is expecting to realize £520 million in the first year of the programme and the money will be used to fund sports programmes in schools to encourage an active lifestyle.
Britain joins others countries such as Belgium, France, Hungary and Mexico, all of which have imposed some form of tax on drinks with added sugar. Scandinavian countries have levied similar taxes for many years.