The UK Government are consulting on proposals to extend the soft drinks industry levy (SDIL) to more drinks.
The consultation sets out proposals for changes to the minimum sugar content threshold at which the levy applies, and the current exemptions for milk-based drinks and milk substitute drinks.
The government is not seeking to revisit the SDIL’s fundamental design and scope; the SDIL will remain a tax on pre-packaged soft drinks with added sugar.
These proposals are:
- to reduce the minimum sugar content at which the SDIL applies to qualifying drinks from 5g to 4g. The SDIL standard rate would apply from 4g to 7.9g total sugar per 100ml, as opposed to 5g to 7.9g total sugar per 100ml currently
- to remove the exemption for milk-based drinks whilst introducing a ‘lactose allowance’ to account for the natural sugars in the milk component of these drinks
- to remove the exemption for milk substitute drinks with ‘added sugars’ beyond those sugars derived from the principal ingredient, such as oats or rice
Since its announcement in 2016, the SDIL has successfully led to extensive product reformulation, with a 46% reduction in the sugar in soft drinks in scope of the levy. Between 2015 and 2019, 65% of soft drinks that contained more than 5g sugar per 100ml reformulated to below 5g, bringing the total proportion of the market with less than 5g sugar per 100ml to 89%. However, UK sugar intakes remain around double the recommended levels.
The UK Government welcomes views on these proposals as part of this consultation and your feedback will inform decisions by HM Treasury ministers. Following this consultation, the government expects to confirm the final policy at Autumn Budget 2025. – Strengthening the Soft Drinks Industry Levy – GOV.UK
