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Effects Of The ‘Sugar Tax’ Already Being Felt

BB foodservice – the delivered foodservice arm of Bestway Wholesale has revealed it’s already seeing effects from the soft drinks industry levy, which came into play on Friday 6 April 2018.

Tony Holmes, sales director, BB Foodservice (Bestway Wholesale) said: “Several of our key suppliers have been making recipe changes in preparation for the levy, with Britvic already having cut sugar across its product range, including Fruit Shoot and J2O. And changing patterns in our sales data suggests operators are making changes too. Our March sales of lower and zero sugar variants are much higher than they were last year.”

Depending on how much extra sugar has been added to a drink, an additional levy of 18p or 24p per litre will be applied:

  • No tax on drinks with less than 5g of sugar per 100ml
  • Low tax (18p per litre) on drinks with between 5-8g of sugar per 100ml
  • High tax (24p per litre): on drinks with +8g sugar per 100ml

How the levy affects popular brands[1]

  • No tax: Diet Coke, Coke Zero, Pepsi Max, Schweppes Slimline Tonic Water, IRN-BRU, and Red Bull Sugarfree
  • Low tax: 7up
  • High tax: Coke, Pepsi, Red Bull

Tony Holmes concludes: “There’s no legal requirement to pass the additional cost on to customers. However, the government and policy makers have made it clear they expect to see price differences as a result of the levy. And we expect many operators will have little choice but to pass on at least some of the cost. Our advice is to review your offer, ensure you’re giving customers a wide choice, and replace your slowest selling lines with lower and zero sugar variants.

[1] List supplied is non-exhaustive

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