Position Statements

UK Soft Drinks Tax

Evidence shows the tax will not reduce obesity but will risk jobs

  • At a time of great economic uncertainty the Government should be supporting UK businesses and consumers rather than putting additional pressure on them with a soft drinks tax, which experience suggests will not be effective in addressing obesity.
  • Independent analysis shows the soft drinks tax will lead to over 4,000 job losses across the UK and a decline of £132 million in the UK economy, predominantly in retail and hospitality, including pubs and small corner shops.
  • There is no evidence that food taxes have an effect on obesity. In 2013, Denmark scrapped its fat tax because of its economic impact and abandoned plans for a tax on sugar.  Evidence from France shows that while sales of soft drinks initially fell after a tax was introduced in 2012 they have increased since. In Mexico the impact of a soft drinks tax saw a reduction of only 6 fewer calories a day, per person in a diet of over 3,000.
  • By taking evidence based action soft drinks companies have reduced sugar intake from soft drinks by over 16% in the last four years.
  • In 2015 the soft drinks sector became the only food and drink category with an ambitious plan to reduce calorie intake from its products by 20% by 2020. As an industry we have also voluntarily committed not to advertise regular soft drinks to under 16s across all media channels including online

Industry initiatives and their impact

Manufacturers have been taking steps to reduce the calorie content of their drinks over many years; nearly 60% of drinks are low and no calorie.

Overall, soft drinks (including fruit juice) contribute just 3% of calories to the average UK diet. Nonetheless, the industry has taken major steps to help consumers reduce their sugar intake by removing sugar from their products, increasing the availablity of smaller pack sizes and significantly stepping up the promotion of low and no calorie options. These efforts are having a marked impact:

  • Sugar from soft drinks has been reduced by more than 16% since 2012 [Kantar Worldpanel, May 2016]
  • Latest NDNS data shows figures show 11-18 year olds drank 23% less sugar-sweetened beverages between 2010-2014 (National Diet and Nutritional Survey, September 2016)
  • NDNS also shows that between 2012 and 2014 teenagers' sugar intake from soft drinks has dropped by over 8%.
  • The 2015 Defra Family Food Survey shows that purchases of regular soft drinks fell by 32% between 2010 and 2014, whilst low calorie drinks purchases increased by more than a third.
  • Between 2012 and 2014 UK soft drinks manufacturers have increased their advertising spend on low and no calorie drinks by 70%.
  • Sales of smaller pack sizes have increased by 26.5% since 2011. [Canadean, 2015]

 Background information

  • In a 2016 report commissioned by BSDA Oxford Economics found the tax will lead to a reduction of just 5 calories per person, per day. This is a total of 0.2% reduction in the recommended daily amount. The OE report can be found here
  • The OE report also found that 1,246 direct jobs in retail and 1,276 in hospitality will be impacted by the soft drinks tax.
  • The new soft drinks industry levy will cost the taxpayer £1 billion in its first year http://cdn.budgetresponsibility.org.uk/March2016EFO.pdf (page 8)
  • The most comprehensive report on tackling obesity by McKinsey ranked taxes fourth from bottom in terms of impact out 16 options for action. Both reducing portion sizes and reformulating products had a far greater impact on levels of obesity. McKinsey Report 2014
  • We are already taking action to reduce the sugar consumed from our products, through reformulation, promoting diet versions of drinks, and through smaller portion sizes – the actions acknowledged by Public Health England as most effective.
  • The decision to propose the soft drinks tax appears to have been taken based on data from 2012 and does not factor in the significant action taken by companies to reduce sugar consumption from our products in the last four years. In light of all the available evidence surely the Government should now review this policy.

Further information on the proposed UK soft drinks tax can be found at the website below

tax website