New 'sugar tax' on soft drinks: The facts

  • Consumer
George Osborne announced a levy on sugary drinks Credit: PA

Chancellor George Osborne has unveiled a new so-called 'sugar tax' in a bid to cut childhood obesity and raise hundreds of millions of pounds for sports in primary schools.

Here are the details of the newly-announced sugar levy on soft drinks:

It will apply to all drinks with ADDED sugar - but not chocolate or flavoured milk with added sugar, nor pure fruit juices.

It will be levied on firms which produce or import more than six million litres of soft drinks per year.

Drinks will be divided into three bands:

  • Exempt rate: Drinks with 5g sugar per 100ml or less

  • Lower rate: Drinks with 5-8g sugar per 100ml

  • Higher rate: Drinks with 8g+ sugar per 100ml

The charge producers will have to pay is 18p per litre for the lower rate, and 24p per litre for drinks in the higher rate.

Regular Coke is in line for the highest level of tax Credit: PA

The Chancellor's office says he hopes it will encourage firms to produce lower sugar versions, but also smaller sizes of drinks as the levy will be charged on the volumes sold.

Drinks which will be exempt from the levy include:

  • Standard lemonade

  • Lucozade Sport

  • Vimto

  • Pure fruit juice

Drinks in the lower rate include:

  • Coke Life

  • Fanta Orange

  • Normal tonic water

Those products facing the highest charge include:

  • Regular Coke

  • Irn Bru

  • Red Bull

  • Strawberry Ribena

The levy will raise hundreds of millions of pounds for the Treasury Credit: PA

It will raise hundreds of millions of pounds for the Treasury and will be used in part to fund the longer day for secondary schools which was announced yesterday.

The cash will also go towards doubling funding for sport in primary schools

But the revenue falls away in subsequent years, as the Treasury predicts products and habits will change.

  • £520m in 2018/19

  • £500m in 2019/20

  • £455m in 2020/21