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Sugar tax to come into effect in 2018

Published 18/05/2016

The sugar tax was unveiled by George Osborne as part of the Budget in March
The sugar tax was unveiled by George Osborne as part of the Budget in March

A sugar tax that could hit drinks such as Coca-Cola, Pepsi and Red Bull will come into force from 2018.

The tax, unveiled by George Osborne as part of the Budget in March, will be set out in the Finance Bill 2017, before targeting producers and importers from 2018.

The move is expected to raise over £520 million which will be used to double the amount of funding for sport in every primary school, with secondary schools encouraged to offer more sport as part of longer school days.

It will also provide more than £10 million of funding a year to expand breakfast clubs in up to 1,600 schools from September 2017.

Drinks with 5g of sugar per 100ml will face a lower rate of tax while those with more than 8g per 100ml will face a higher rate.

The rates of tax have not yet been set.

The Office for Budget Responsibility has estimated it could add 18p to 24p to the price of a litre of fizzy drink if the full cost is passed on to the consumer.

Jamie Oliver and health charities welcomed the sugar tax, which is part of a drive to cut rates of childhood obesity.

The Government's national childhood obesity strategy, which was due to be published last year, has been delayed until later this year.

Set out in the Queen's Speech, the Government said the main benefits of the legislation would be to encourage companies to reformulate drinks by reducing the amount of added sugar, and moving people towards lower sugar alternatives.

Professor Neena Modi, president of the Royal College of Paediatrics and Child Health, said: "Currently in the UK around one in five five-year-olds and one in three 10-year-olds are overweight or obese. Based on current trends, half of children will be obese or overweight by 2020.

"These high-calorie, cheap drinks have no nutritional benefit, increase the risks of becoming overweight, and in addition have contributed to around 130,000 UK children over the last four years having to have their teeth extracted because of decay.

"Obesity is a timebomb, and one of the most serious threats facing our children. It is also a global issue.

"The Royal College of Paediatrics and Child Health lobbied hard for the introduction of a tax on sugar sweetened beverages because the best available evidence suggested this would be likely to have a positive impact.

"We now urge the Government to evaluate the effectiveness of the sugar tax carefully, so that other countries and their children can benefit."

Jonathan Isaby, chief executive of the TaxPayers' Alliance, said: "It is deeply concerning that the Government is pushing ahead with this regressive charge in spite of the overwhelming body of evidence showing that it's doomed to failure.

"The solution to tackling obesity and other health problems related to lifestyle choices is better education and personal responsibility. Slapping arbitrary taxes on a few products due to pressure from the taxpayer-funded health lobby will hit the poorest and fail to achieve the desired results."

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