UK introduces sugar tax on soft drinks

ITN

UK Chancellor George Osborne unveils a tax on sugary soft drinks.

Britain has introduced a sugar tax in what's being called a "profound move" which will take over the world.

UK Chancellor George Osborne made the surprise move to introduce a sugar-levy on soft drinks from 2018 in Wednesday's budget, in which other so-called "sin taxes", including the excise on beer, whiskey and cider, were all frozen. 

Osborne said the tax increase, which the government ruled out as recently as February, was being introduced to improve children's health.

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"I am not prepared to look back at my time here in this Parliament, doing this job and say to my children's generation... I'm sorry. We knew there was a problem with sugary drinks. We knew it caused disease. But we ducked the difficult decisions and we did nothing," he told the House of Commons. 

READ MORE:
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Britain will introduce a sugar levy on soft drinks in two years' time to tackle a growing obesity crisis.
REUTERS

Britain will introduce a sugar levy on soft drinks in two years' time to tackle a growing obesity crisis.

The sugar tax will be limited to soft-drinks and not other sugary foods like lollies.

Responding to the Conservative government's move, chef Jamie Oliver, a long-time campaigner for a sugar tax, welcomed the "amazing news" in a post on social media. 

"We did it guys !!we did it !!! A sugar levy on sugary sweetened drinks ......," Oliver wrote. 

Britain's Chancellor of the Exchequer George Osborne taking his seat after delivering his Budget to the House of Commons.
REUTERS

Britain's Chancellor of the Exchequer George Osborne taking his seat after delivering his Budget to the House of Commons.

"A profound move that will ripple around the world ....business can not come between our Kids health!!"

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Oliver told Britain's Sky News the move came as a complete surprise to him. 

"Surprisingly and fascinatingly we've seen Mr Osborne come out with a bold, brave tax...I'm shocked but in all the right ways, I'm humbled actually," he said.

Jamie Oliver has campaigned against unhealthy food around the world, starting with a TV show about food in Britain's schools.
HARRISON SARAGOSSI/FARIFAX MEDIA

Jamie Oliver has campaigned against unhealthy food around the world, starting with a TV show about food in Britain's schools.

"This will travel right around the world, to Canada, to Australia," he said. 

HOW WILL THE SUGAR LEVY WORK?

Britain's sugar-levy will begin in 2018 which the government hopes will give manufacturers time to reduce the amount of sugar in their drinks. 

Drinks will more than 8 grams of sugar per 100 millilitres will be taxed at a higher rate than drinks with less than 5 grams of sugar per 100 millilitres. 

"Pure fruit juices" and milkshakes will not be subject to the sugar-levy. 

ISN'T THAT UNFAIR?

Expect the soft-drink industry to argue this point given thickshakes, milkshakes, smoothies and juices can all contain a lot of sugar but won't be taxed under this measure.

WHO PAYS?

Companies will pay the tax but the government expects some manufacturers will pass on the costs to customers making soft-drinks more expensive, and consumed less. 

How much money will it raise?

£520 million or more than NZ$1 billion.

The UK government says it will spend the revenue on fitness programs and extended school hours for children so they can take part in more sports.

WHO ELSE HAS A SUGAR TAX?

Scandinavian countries, Hungary, Mexico and France, Chile, the Californian city of Berkeley and Dominica.

Many Asian countries are also considering the idea. Interestingly, Denmark introduced a soft drink tax and a fat tax and then repealed them saying they didn't work.

DOES THE INDUSTRY HATE THIS?

You bet and they cast doubt on the ability of the tax to reduce consumption. 

Paul Polman from Unilever, which makes processed foods, has rubbished a sugar tax as too simplistic to solve the obesity crisis which plagues developed countries.

But the manufacturers have also begun to reduce the amount of sugar in their drinks, pre-empting government regulation.

 - Sydney Morning Herald

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