Sugar Tax: Yay or Nay?

Emma Hogan 13 February 2019

Are you a soft drink addict?

On April 6 2018, the new Sugar Tax came into effect to be applied to soft drinks such as Coca Cola, Redbull etc. This essentially means that for drinks containing 5-8g of sugar, manufacturers are charged an additional 18p per litre whilst those drinks containing more than 8g will face a 24p per litre tax.

Most manufacturers are passing on this charge to their shoppers so if you’re regularly buying soft drinks you’ll have no doubt seen the cost of your sugary tipples increase since April.  We’ve seen some sneaky pack size changes too – can you spot the impact Sugar Tax has had on the products below?

That’s right – whilst Coke Zero and Diet Coke are £3.00 for 8 cans (Sugar Tax exempt), Original Coke is the same price for just 6 (Original attracts the highest rate of Sugar Tax).

Why is this happening? The Government are aiming to tackle the rise of Type 2 Diabetes and obesity – the idea is that by making for example the Original coke above approximately 37% more expensive we’ll be more attracted to the sugar-free / low sugar alternatives.

Why are we talking about it now?

Although the changes in consumer behaviour haven’t been drastic post Sugar Tax; 62% of UK shoppers claim to have not changed their consumption behaviour in any way in the 6 month period after it was imposed, manufacturers seem to have taken up the slack by reducing the sugar in their drinks to avoid the sugar levy.

But sugary drinks aren’t the only ‘junk’ food facing criticism.  Manufacturers of confectionery such as cakes, biscuits, sweets are also under pressure to reduce the amount of sugar in their products.  Groups such as “Action on Sugar” are going after both manufacturers and retailers by proposing a 20% tax on sweets as well as a ban on sharing bag promotions to help change our buying and eating habits.

With the industry seeing this tax extension, though not confirmed, as inevitable, manufacturer research and development into low sugar / zero sugar alternatives by confectioners has increased dramatically by 14%. The brands you love are leading the way by introducing products such as Haribo’s Fruitilicious containing 30% less sugar that regular gummy sweets.

How will the Tax extension affect us?

If “Action on Sugar” have their way, sharing bags may increase by 20% (~£1.80 – £2.00) with no promotions available whilst all other confectionery may see an increase of 20%.

As it’s February and Valentine’s day (and this year may be the last without a sugar tax applied!) – we took a look at next year’s potential prices for bestselling Valentine’s confectionery based on a 20% tax:

What do you think?

We polled 103 of our LaunchPanellists to find out whether they believe that the Sugar Tax should be extended to confectionery goods, here’s what they had to say…

So Yay or Nay?

Whilst the existing Sugar Tax hasn’t made a drastic change in the way we’ve shopped for soft drinks as yet; the Tax is affecting manufacturers, retailers and our behaviour.  This combined effort is reducing the amount of sugar in products, reducing promotions on sugary products and ultimately may reduce the probability of us reaching for that full fat can of Coke in favour of Diet or Zero.

So in terms of the Tax extension, whilst we may not collectively want to pay more for our sharing bag of Maltesers, how often would we buy and devour them in one go if they were full price (+ tax) at £1.80 rather than the usual £1 promo? We’ll leave you to ponder!

What’s your opinion? Do you think that a sugar tax should be imposed? How willing would you be to buy confectionery goods if they increased by 20%? Let us know on Facebook, Twitter or Instagram.

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