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MPs’ appetite to boost the ‘Sugar Tax’ is growing

It will be years before we know whether or not the ‘Sugar Tax’, which came into effect in April 2018, has actually helped to stem the rising tide of obesity in the UK.

Some, like Robert Jenrick MP, claim that the tax is already working because “in the time between announcing this policy and it taking effect, more than half of all soft drinks have been reformulated to lower sugar content”.

This is true, but the most widely consumed full-sugar brands, including Coca Cola and Pepsi, have not reformulated. These brands are passing on the tax to supermarkets and ultimately to the consumer. Analysts suggest that the levy adds an extra 8p to a 330ml can of high-sugar cola and 48p to a 2-litre bottle.

Whether or not the sugar tax is working, it is clear that Britain’s public health obesity crisis is deepening.

According to the latest NHS figures, obesity contributed to 617,000 hospital admissions in 2016/17, up 18% on 2015/16.

Our research suggests that MPs have a healthy appetite for more regulation when it comes to the sugar tax with support for increasing its value and scope up since 2016.

What’s the evidence from other countries that have introduced sugar taxes?

The most comparable example is Mexico, which introduced a 10% tax on sugary drinks in 2014.

Four years after its implementation, research from the Monthly Survey of the Manufacturing Industry (EMIM) of the National Institute of Statistics and Geography (INEGI), suggests that consumers reacted to the change in prices in the short term, but have resumed their usual consumption level over time.

In addition, the Instituto Tecnológico Autónomo de México’s study, Caloric Taxation in Mexico, indicates that, as a result of the sugary drink tax, people reduced consumption by 6–10kcal per day, which, when compared with the 3,072 that Mexicans consume daily, represents a barely perceptible reduction of only 0.26%.

Will the sugar tax reduce the rising tide of obesity in the UK?

It’s too early to tell. The tax only came into effect three months ago. We need to wait and see.

Are sugary drink makers concerned?

At the current level, few soft drinks manufacturers fear that the sugar tax will have a large impact on their profits, particularly as they are mitigating potential losses by marketing low-sugar versions and reducing bottle size. However, they, along with most major food manufactures, are worried about what comes next.

Will the sugar levy be increased in value and extended to other products?

Support for increasing and extending the sugar levy to other products has increased significantly.

In 2016, when the government announced the sugar tax policy a quarter (24%) of MPs supported increasing and extending the levy to other products.

Two years later with no clear evidence to suggest that the sugar tax is working, over a third (36%) say that they would support increasing the levy and over half (53%) extending it to other products.

What other activities do MPs think would be acceptable to try to tackle obesity?

Populus research indicates that targeted interventions to help obese people reduce weight and a ban on marketing to children under 16 would have strong support from MPs.

A tax on ‘fast food’ would also be acceptable to MPs, but a ban on supermarket promotions, minimum pricing and a minimum purchasing age for products that are high in sugar, salt or fat would be considered unacceptable.

Introducing a tax on chocolate/confectionary is seen currently as only fractionally more unacceptable than acceptable.

What should we expect?

While the effectiveness of the sugar tax in reducing obesity in the UK is unproven, politicians seem to have reached the conclusion that ‘something has to be done’.

It will take years before clear evidence on the effectiveness of the sugar tax is available, but MPs are primed to press ahead with increasing and extending the sugar levy regardless.

The issue of obesity has become so acute in the UK that politicians feel that the risks of inaction are greater than the risks of action. While we wait for evidence on the effectiveness of the sugar tax, expect more rather than less legislation on obesity.


David Racadio

David is responsible for Populus's industry studies, which help clients in a range of sectors, including banking, insurance, food manufacturing, pharmaceuticals and retail, to benchmark their corporate reputations and understand the attitudes of key stakeholders that impact on their industry.

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