‘Complex’ sugar tax draft slammed

By Gwen Ridler contact

- Last updated on GMT

New draft legislation for the UK sugar tax was slammed for being 'complex'. Image: Petr Kratochvil
New draft legislation for the UK sugar tax was slammed for being 'complex'. Image: Petr Kratochvil

Related tags: Sucrose, Soft drink, Tax, British soft drinks association

Draft legislation for the Soft Drink Industry Levy has been described as “complex” and raises “serious questions” if a sugar tax would work, said law firm DWF.

The Soft Drink Industry Levy would see manufacturers charged for producing drinks with 5g of added sugar per 100ml. But it does not apply to milk based drinks – which contain at least 75% milk content – or fruit juices.

DWF partner Dominic Watkins told FoodManufacture.co.uk​ that the tax would not drive the change desired, as consumers would choose cheaper fruit or milk drinks not covered by the tax, but were equally high in sugar.

“The tax published today ​[December 5] is complex and requires a couple of reads to understand what is and is not covered,”​ said Watkins.

‘Further legislation’

“It is positive that naturally occurring sugars in fruit and milk is not considered added sugar. But we will have to see if the government releases further legislation to prescribe what fruit or vegetable juice is, as it has given itself this power. 

“Additionally, we will have to wait until the budget to understand what level the levy will be set at.”

Watkins argued that taxation was not the answer to the UK’s obesity crisis and that a greater focus on exercise and education on preparing healthy foods was needed.

“This move is viewed against a market where sales in ‘regular’ soft drinks are falling and 58% of the drinks sold in the UK are either low or no calorie and that number is likely to rise,”​ added Watkins.

“One, therefore, questions whether this is really the right step. There is no golden bullet and we need a much broader approach to this complex issue.”

‘No golden bullet’

The draft was also slammed by the British Soft Drinks Association (BSDA), which claimed that similar taxes had been ineffective in cutting obesity worldwide.

Gavin Partington, BSDA director general, said: “It is ironic that soft drinks are being singled out for tax when we’ve led the way in reducing sugar intake, down over 17% since 2012. We’re also the only category to have set a 20% calorie reduction target for 2020.”

The BSDA pointed at failed attempts to implement a sugar tax in Denmark, France and Mexico.

The organisation also claimed that the tax would lead to more than 4,000 jobs losses in the UK and a decline of £132M in the economy.

Watkins added: “The oft cited Mexican example only resulted in a six calorie reduction on a 3000 calorie diet and research suggests that our tax would result in a 5 calorie reduction.”

Soft Drink Industry Levy draft – at a glance

  • Due to be implemented April 6 2018
  • Applies to drinks with 5g or more added sugar per 100ml
  • Drinks made with 8g or more added sugar will be taxed more
  • Charges have not been revealed yet
  • Drinks made with 75% milk are exempt from the tax
  • Similarly, drinks that are similar to an alcoholic beverage are exempt
  • Commissioners can determine what counts as a soft drink
  • Producers will be charged when the levy is implemented

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