Sugar tax set to add 8 pence to cost of a can
Cans of fizzy pop look set to cost as much as 8 pence more as the new sugar tax comes into force this April.
The Soft Drinks Industry Levy (SDIL), also known as ‘the sugar tax’, is set to make soft drinks companies pay a charge for drinks with added sugar after it was announced in the 2016 Budget in a bid to tackle rising obesity rates.
The new tax will make soft drinks companies pay a charge for drinks with added sugar with two bands for deciding on the tax increase.
The amount of tax depends on the total sugar content of the drink with companies having to pay 18p per litre on tax if the drink has 5g of sugar or more per 100ml, or 24p per litre if the drink has 8g of sugar or more per 100ml.
The Government has said this is not a tax on consumers, meaning companies do not have to pass the charge on to customers; however, prices of sugary soft drinks are expected to rise. Under the new tax system a 330ml can of Coca Cola, Old Jamaican Ginger Beer, Pepsi and Dr Pepper are expected to cost 8p more; and a 330ml can of Sprite, Fanta and Schweppes Indian Tonic Water could cost 6p more.
A litre bottle of pop could cost as much as 24p extra. The new sugar tax is a welcome step for health campaigners.
But not all popular sugary drinks are set to be hit with the extra tax. Schweppes Lemonade, Lilt and Tango are all exempt from the tax increase due to their smaller sugar content levels – as well as Irn Bru, whose parent company A.G Barr famously changed its recipe at the start of the year to get around the forthcoming sugar tax by limiting its sugar content from 10.3g per 100ml to just 4.7.
Drinks with a high milk content will also be exempt from the tax as they contain calcium and other nutrients, as well as fruit juices because they do not contain added sugar.