UK Sugar Tax is Already Working

April 9, 2018 Taxation in UK

sugar tax in the UKLONDON – The UK’s sugar tax has already forced drinks manufacturers to reduce their sugar, and will lead to young people consuming less sugar, while older consumers are showing very little sign of wanting to change.

New research conducted by experts at the UK Institute of Fiscal Studies has suggested that the country’s newly-enacted sugar tax will lead to a reduction in sugar consumption among only a select group of people in the country.

Under the new rules enacted on the 6th of April, drinks manufacturers will need to pay a tax of GBP 0.18 per litre on drinks with a sugar content exceeding 5 grams per 100 ml, and a higher tax of GBP 0.24 per litre on drinks with more than 8 grams per 100 ml.

The researchers believe that most consumers will see some reduction in their sugar consumption, however, young consumers will see their consumption drop by 80 percent more than the average consumer.

However, consumers who already have a high-sugar diet are not as price elastic, and will not be as willing to drop their sugar consumption following the tax-led price hike.

It was also noted that along with a change in consumer behaviour, approximately half of manufacturers have already dropped the sugar content in their drinks in order to bypass the tax.

The World Health Organization recommends that only 5 percent of an individual’s daily calories are sourced from free sugar, however, approximately 94 percent of British consumers do not meet this guideline.