Budget 2016: Soft drink prices may rise from 2018


Chancellor George Osborne has today announced that from April 2018, the government will charge a sugar levy on producers and importers of soft drinks.

There will be a main rate charge for drinks with more than five grams of sugar per 100 millilitres, and a higher rate charge for drinks with more than eight grams of sugar per 100 millilitres.

Pure fruit juices and milk-based drinks will be excluded, as will the “small operators”.

But while this is a tax on the industry, Mr Osborne says “some [companies] may choose to pass the price onto consumers and that will be their decision”.

This means the price we pay for soft drinks may increase from 2018.

Mr Osborne adds that many in the soft drinks industry have already started to reformulate their products. He says Robinsons recently removed added sugar from many of its cordials and squashes, while Sainsbury’s, Tesco and the Co-op have reportedly committed to reducing sugar across their ranges.

Taxes raised from this sugar levy will go towards sports initiatives in schools.

The government will consult on the exact details of how this will work this summer.

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