UK levy on soft drinks predicted to have significant health benefits

The UK is preparing to introduce a soft drinks levy in April 2018; one of the first studies to assess its possible impact has recently been published in The Lancet. The tax is different across categories of soft drinks, with no tax on diet and low-sugar drinks, a low tax on mid-sugar drinks (5-8g of sugar per 100ml); and a high tax on high-sugar drinks (over 8g of sugar per 100ml). The study claimed that there would be three main ways in which the soft drinks industry would react. They would reformulate drinks to reduce sugar content, raise the price of soft drinks to cover the levy, and market lower sugar drinks to consumers more. The researchers then assessed each reaction in terms of its likely effect on rates of obesity, diabetes and tooth decay.

The study found that the response of lowering sugar content would have the greatest effect on health. The authors estimated that a 30% reduction in sugar content of high sugar drinks – a step many manufacturers have already taken, accompanied with a 15% reduction of medium sugar drinks could lead to 144,000 fewer people with obesity, and 19,000 fewer cases of T2DM. Adjusting prices would result in reducing the number of people with obesity by 81,600. Children are likely to benefit most from these changes. Fortunately, the study found that all the most likely industry responses to the levy will result in lowering obesity, T2DM and tooth decay rates, however one must remember that these numbers are purely estimates, it may be a while before we see tangible benefits from next year’s tax.