Britain’s Chancellor of the Exchequer unveiled a new tax on sugary drinks as part of the 2016 budget.
Source: Carol Adl
George Osborne said drinks with more than five grams of sugar per 100 milliliters will be taxed saying that sugary drinks serve as “one of the biggest contributors to childhood obesity”
Drinks will fall into two bands, one for total sugar content above 5g per 100ml, and a second, higher band for the most sugary drinks with more than 8g per 100ml.
The tax which is to be imposed on the makers of sugary soft drinks, will come into force in 2018.
“I can announce that we will introduce a new sugar levy on the soft drinks industry,” Osborne said, adding that the delay in implementation of the new measure was meant to “give companies plenty of time to change their product mix.”
The sugar tax announcement sparked a big fall in the share price of soft drinks makers but it was welcomed by TV chef Jamie Oliver, who has been campaigning for such a move.
Oliver wrote on his social media accounts: “We did it guys !! We did it !!! A sugar levy on sugary sweetened drinks.“
However, some experts warned that manufacturers may opt to increase the price of their products rather than start a reformulation of the ingredients in the drinks.
Wednesdays other budget announcements include:
- Growth forecast cut for the next five years and £3.5bn in extra public spending cuts by 2020
- Fuel duty frozen for the sixth year
- 2% increase in tax on cigarettes, with 3% on rolling tobacco, from 6pm, but beer and cider duty will be frozen as will the levy on whisky and other spirits
- Plans for a longer school day in England
- The rate at which workers start paying top rate tax is to be raised from £42,385 to £45,000, with the tax-free personal raised to £11,500 and corporation tax to be cut to 17% by April 2020
- On savings, the ISA limit will be increased to £20,000 a year for all savers, and lifetime ISAs will be introduced for young people
- An extra £700m for flood defences – to be paid with a 0.5% percentage point increase on the tax on insurance premiums
- The higher rate of Capital Gains Tax is being cut from 28% to 20%