UK Parliament to Debate Case For Sugary Drinks Tax

27 Nov 2015 --- The UK Parliament is to debate on the introduction of a sugary drinks duty on Monday 30th November. A briefing paper, detailing the proposal has been published by Sustain, one of the organisations that launched the petition that has led to the debate. Advocates think that a sugary tax of 20% on sugary soft drinks could be used to improve education for children on the obesity and healthy lifestyle, which is a major issue globally.

Sustain and Jamie Oliver, celebrity television chef who is also campaigning for the move, are calling on the Government to introduce a 20p per litre (7p per can) duty on sugary drinks in their forthcoming Childhood Obesity Strategy. The duty should sit alongside a series of other measures – including protecting children from all forms of junk food marketing, rebalancing price promotions, a robust reformulation and portion size reduction programme with quantifiable targets, improved labelling, greater support for food education in schools, and the public sector leading by example – to make healthier, more sustainable choices as available, affordable, advertised & acceptable as less healthy options currently are. 

According to Sustain, in order to be successful, a food duty has to be consistent, and appeal to people’s common sense. A duty on sugary drinks would seem to be both logical and proportionate. It would be: targeting a product that is the top contributor of free sugars to the diets of children and young adults, accounting for almost one-third of their total intake; targeting a product considered non-essential, with few or no nutritional benefits apart from the calories; levied only on soft drinks with added sugar – so not pure fruit juices or drinks made with sweeteners; an excise duty rather than a sales tax – so increasing proportionately to the volume of drink purchased and thus discouraging consumers from purchasing larger volumes or switching to cheaper brands; straight-forward and quick to implement in stores and outlets; easy for consumers to understand; act as a positive nudge on purchasing behaviour, whilst not restricting consumer choice. 

The action has the support of many big, reputable organisations, including the British Medical Association, British Heart Foundation, British Dental Association, British Dietetic Association, Academy of Medical Royal Colleges, Faculty of Public Health.; four former health ministers: Dan Poulter, Stephen Dorrell, Alan Johnson and Ben Bradshaw. • more than two-thirds of GPs, and a similar proportion of Royal Society for Public Health members. And support from all four nations of the UK, including The Royal College of Physicians of Edinburgh, Cardiff and the Vale University Health Board, and Northern Ireland Chest Heart & Stroke. A sugary drinks tax also has the support of Unite and Unison trade unions, and a broad coalition of civil society, including CitizensUK, National Federation of Women's Institutes, Netmums, Friends of the Earth and Soil Association. 

Diet-related ill health disproportionately affects lower income groups, so any moves to tackle health inequalities should be welcomed. Some of the highest consumers of sugary drinks are also the most price conscious, and thus most likely to switch to cheaper (and healthier) alternatives. The studies suggest that people who swap to lower or no sugar alternatives, don’t tend to add on the extra sugar and calories elsewhere in their diets. In addition, the expenditure of the Children's Health Fund could be aimed more at particular demographics and areas to also ensure that this was a progressive measure, benefiting families in poverty and on low incomes. International examples of a sugary drinks tax Mexico’s tax on sugary drinks has resulted in a 6% reduction in soda purchases in the country during 2014, with the year-on-year reduction reaching 17% by the year-end. Importantly, evaluation of the first year of the tax has revealed that the reduction was greatest amongst lower-income groups. Demand has also fallen in France (by 3.3% in 2012 and 3.4% in 2013), in Hungary (by 7.5% in 2012 and 6% in 2013) and also in Finland, since those countries introduced their versions of the duty. In France, Finland and Hungary the full cost of the duty has been passed on by manufacturers to consumers. 

A twenty pence per litre duty on sugary drinks would expect to raise between £300m to £1 billion in its first year. There is a strong case for hypothecating this revenue. The money could be used by the Treasury for population-wide evidence-based interventions, such as extending free school meal eligibility or boosting Healthy Start programmes; or be hived off into a pot – a Children’s Health Fund – to support innovative local and regional public health projects and easy access to drinking water in public institutions and spaces. The ‘ear-marking’ of taxes is becoming more widespread, with the re-calibrated Vehicle Excise Duty (or road tax) to be put exclusively into a new Roads Fund from 2020, and the proposal for Councils to raise an additional 2% in Council Tax for social care funding. The public has readily accepted the plastic bag levy, with retailers quick to promote the environmental or other good causes that the money is going towards. Sustain are piloting a smaller scale Children’s Health Fund, partnering with Jamie Oliver’s restaurant group, Leon, Abokado, Tortilla and others. These restaurants are voluntarily putting a 10p levy on soft drinks with added sugar on their menus, allowing this concept to be tested to see how it affects customer purchasing habits. 

Whilst there could in the future arise a strong case for extending the duty to other sugary products or to sweeteners, the evidence and policy base is there now specifically for a duty on drinks with added sugar. However, other measures should concurrently be taken to reduce the sweetness of our food and drink, in the same way that salt has been gradually reduced in many products over the past decade. Children should be encouraged to drink water and milk, and fruit juice be limited to a 150ml portion per day, as outlined in the revised School Food Standards. Public procurement should remove the most sugary products from their stock and promote the healthier alternatives; something which manufacturers themselves should do with their ranges aimed at children’s consumption. Decreasing the cost of certain healthier options, whether via reducing the duty or subsidising the price, could be done at the same time as the introduction of a 20p per litre duty on sugary drinks - so maintaining no net tax increase. A sugary drinks duty would likely incentivise companies to shift R&D, production and promotion to no-sugar alternatives, and thus would have a neutral net impact on jobs or investment within the industry.

Parliament will debate on Monday.