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Sugar tax on soft drinks will put over 4000 jobs at risk, report claims

DBR Staff Writer Published 16 August 2016

A new report by Oxford Economics has revealed that the soft drinks tax proposed by the UK Government in this year’s budget risks more than 4,000 jobs across the country.

The British Soft Drinks Association (BSDA), which represents soft drink manufacturers, wholesalers and retailers is concerned about the report, which claims that the new sugar tax will only lead to a reduction of 5 calories per day.

The amount of sugar equates to just a bite of apple and the report claims that the heaviest impact would hit heavily on the hospitality industry and small retailers. And this sugar tax would come into force from 2018.

The tax will be levied on drinks with more than 5g of sugar dissolved in 100ml of liquid and it was unveiled by former Chancellor George Osborne in March, in the budget to counter growing cases of obesity.

In terms of the sales, the report also claims that the tax can negatively impact sales by 1.6% and can reduce £132m ($170.5m) of soft drink industry’s contribution to the GDP.

BSDA Director General Gavin Partington said: “Post-Brexit, securing investment and jobs is more important than ever. This research shows the soft drinks tax is not only ineffective in fighting obesity but will come at a significant price for the economy, costing thousands of jobs. 

“As an industry we recognise that obesity must be tackled which is why we have invested heavily in reformulating drinks. Since 2012 this has led to a 16% reduction in sugar intake from soft drinks. The tax is therefore unnecessary and harmful to our economy.”

BDSA also claims that in 2015, the soft drinks industry became the first in the food and drinks category to have come up with an ambitious plan to decrease calorie intake in its products by 20% by 2020.

It has also committed to not make advertisements of regular soft drinks directed towards children below the age of 15 across all media platforms including online.

Gavin Partington also claimed that world over there is no evidence that suggests that taxes on food items or ingredients have had a positive impact on obesity, but says that it can damage thousands of businesses across the industry ranging from farmers to manufacturers and small retailers.