The UK Sugar Tax – what is it and will it work?

The ‘sugar tax’, or to give it it’s correct name, the ‘soft drinks industry levy’ came into force on April 6th, 2018. The tax applies to soft drinks in two bands – 24p per litre for drinks with more than 8g of sugar per 100ml, and 18p per litre for drinks that have between 5g and 8g per 100ml. Fruit juices and milk products are exempt.

The tax isn’t intended to be a tax on consumers, but to encourage companies to reformulate products to reduce sugar and calories. However, the tax may be passed onto consumers in some cases creating a price difference between sugar-sweetened and ‘diet’ or ‘zero’ drinks.

The levy was a shock announcement in the 2016 budget and was one of few specific actions in the disappointing Childhood Obesity Plan, which is due a revamp later in 2018. Public Health England (PHE) is leading a voluntary sugar reduction programme to encourage companies to reduce sugar by 20% across other food categories, therefore helping the population reduce their sugar intake which is currently way higher than recommendations. However currently only soft drinks have a specific sugar levy applied.


UK Sugar Tax - Spoon Guru Expert Insight


How have soft drink manufacturers responded?

Manufacturers were given two years before implementation to enable them to reformulate products. The soft drinks industry has been reducing sugar and calories for many years, very successfully. Sugar reduction from carbonates has been reduced by 19% since 2013. However, there is no denying the extra financial incentive has pushed manufacturers to move even further, faster, with over 50% of manufacturers reformulating drinks.

Notable examples being Irn Bru, which no longer exists in its original form (with the backlash from consumers to prove it), Ribena and Lucozade, which both now have half the amount of sugar they did a year ago, and Coca-Cola products Sprite and Capri-Sun which have been reformulated to ensure they now both avoid the levy. All Tesco own brand soft drinks were reformulated to ensure they were under the levy threshold 17 months before it came into force.


What other actions have manufacturers been taking?

Manufacturers have worked hard to create, and importantly promote, zero sugar options, which have been readily available alongside the regular versions for many years. In 2016 low and no calorie drinks accounted for 58% of the market.

Although Coca-Cola has said their Classic product will not be reformulated, it has reduced pack sizes to account for some of the effects of the levy. This means that per ml Coca-Cola Classic is more expensive than Coca-Cola Zero Sugar or Diet Coke. This could reduce calorie and sugar intake across the population, or it could have consumers reaching for a second bottle and make no difference at all. And that is what we don’t know yet.


Described as ‘the government’s key milestone in tackling childhood obesity’, will it really work?

Firm evidence that sugar taxes lead to a public health benefit is currently lacking, it is providing mixed results and different interpretations.

Although the media focus has been on sugar over the last few years, we need to remember the importance of calories when thinking about obesity.

The latest National Diet and Nutrition Survey (NDNS) came out recently and showed that soft drinks provide 10% free sugars in 4-10 year olds, 22% in 11-18 year olds and 14% in adults. It is important to remember that despite this, soft drinks contribute 2% calories to the diet in children aged 4-10, 4% in 11-18 year olds and 2% in adults. So, making changes to the other 96-98% of calories eaten also needs to be effectively tackled to make a dent in childhood obesity, never mind how we expend our energy.

PHE is also starting work on a calorie reduction programme, however it could be argued this might have been a better starting point.


UK Sugar Tax - Spoon Guru Expert Insight


Unintended consequences?

The introduction of the levy leaves us with lots of questions – is this a one-off or will other sugary (or fatty?) products be taxed in future? How will consumers respond? Will they choose a fruit juice/ smoothie or calorific coffee if they feel they aren’t getting the same value, or importantly the same taste, from their soft drink? Will consumers who dislike sweeteners or are suspicious of them (despite being proven as safe time and time again), choose a chocolate bar as their treat instead of their favourite can of soft drink? If some of these alternative scenarios play out, consumers could end up increasing their calorie intake. Only time will tell how successful the levy will be.


Are other actions required?

Because of the reformulation efforts of industry to bring more products below the threshold than expected, the government won’t make as much money as predicted. It is now thought to be only £240 million – a massive drop from the expected £520 million. Let’s hope the promised public health actions – including investment in school sport and breakfast clubs, will still go ahead. It’s possible that these actions could have more benefit than the levy itself.

Obesity is always described as a complicated, multifactorial condition with numerous influences too many to mention. Therefore, it is optimistic that one action such as the levy will make a significant impact on childhood obesity levels. Which is why we need to see a much stronger and improved Childhood Obesity Plan when the next version is published later this year, including numerous evidence-based approaches.


About the author

Anna Wheeler is a Registered Nutritionist with 15 years’ experience. She worked at Unilever for more than five years in various local and global roles, then moved on to work at Coca-Cola Great Britain as Health & Nutrition Manager. Anna started her consultancy business, Anna Wheeler Nutrition Limited, in 2017. She also chaired the Nutritionists in Industry (NII) network for over four years.

Anna has recently co-founded Nutrition Talent, a recruitment and resourcing agency specialising in the provision of flexible, professional Nutrition resource. It also offers strategic career development support for those with nutrition expertise.

Anna is a member of Spoon Guru’s Nutrition Expert Panel.

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By |2018-05-10T10:33:50+01:00May 10th, 2018|Blog, Expert Insight, Fact Sheets|