The sugar tax applied to fizzy drinks is set to be extended to milkshakes and other milk-based drinks under new government plans.<\/p>\n
The government is consulting on proposals to end the exemption from the tax for dairy-based drinks, as well as non-dairy substitutes such as oats or rice.<\/p>\n
Chancellor Rachel Reeves announced in her autumn budget last year that the government was considering widening the levy.<\/p>\n
The so-called sugar tax, known formally as the soft drinks industry levy (SDIL), applies to manufacturers and was introduced by the Conservative government in April 2018 as a means to tackle obesity.<\/p>\n<\/div>\n
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On Monday, the Treasury also confirmed proposals to reduce the maximum amount of sugar allowed in drinks before they become subject to the levy from 5g to 4g per 100ml.<\/p>\n
Some 203 pre-packed milk-based drinks on the market, which make up 93% of sales within the category, will be hit with the tax unless their sugar content is reduced in accordance with the proposals, government analysis says.<\/p>\n
The exemption for milk-based drinks was included because of concerns about calcium consumption, particularly among children.<\/p>\n
The Treasury said that young people only get 3.5% of their calcium intake from such drinks, meaning “it is also likely that the health benefits do not justify the harms from excess sugar”.<\/p>\n
“By bringing milk-based drinks and milk substitute drinks into the SDIL, the government would introduce a tax incentive for manufacturers of these drinks to build on existing progress and further reduce sugar in their recipes,” the Treasury said.<\/p>\n
The government estimates that 89% of soft drinks sold in the UK are not subject to the tax because of widespread reformulation by manufacturers since 2018.<\/p>\n
But it added that the levy had effectively created a “target” of just below the 5g threshold, and products had clustered below 5g as a result.<\/p>\n
The government consultation will run from Monday until 21 July.<\/p>\n
The SDIL has raised a total of \u00a31.9 billion since its introduction in 2018, according to government statistics released last September. Revenue for HMRC for the 2023-24 financial year was \u00a3338 million.<\/p>\n
Opponents of the levy in recent years include the soft drinks industry, pubs and off licences. Some argue the levy disproportionately affects lower-income families and does little to tackle obesity.<\/p>\n
On the latest plans, industry body the Food and Drink Federation said it welcomed the chance to share its views in the consultation. <\/p>\n
It said “significant progress” had already been made and “many years of investment in research and development” had reduced sugar in soft drinks by 46% in the last five years, with a 30% sugar reduction in pre-packed milk-based drinks in the last three years.<\/p>\n
It added that food and drink manufacturers were facing a series of inflationary pressures and called on the government to “continue to create the right conditions for businesses to innovate and also be clear about their long-term goals to promote business confidence”. <\/p>\n<\/div>\n
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