Budget Day Sweeteners Following Sugar Tax Hit?

22 November 2017

Interesting to reflect on how Budget taxation tactics have changed over the years. Three or four decades ago the Chancellor would solemnly announce 2 pence on cigarettes, a penny on a pint of beer and perhaps 3 pence on petrol, always from 6.00pm that day. Queues at the petrol station, a rush for tobacco and at the pub acceptance beer would be dearer once the doors opened for trade that night. Now any changes that involve extra taxation invariably are announced on Budget day for implementation perhaps more than 12 months down the road, I guess hoping it will be long forgotten by then!

A case in point is Sugar Tax, announced in March this year but not taking effect until April 2018. With two bands of taxation on sugary drinks, 18 pence per litre for more than 5 grams of sugar per 100ml and 24 pence per litre if higher than 8 grams per 100ml. This has the potential to add 8 pence onto a standard can of Coca Cola and will likely increase the switch towards products like Coca Cola Zero and Diet Coke neither of which contains any sugar at all.

So don’t expect any immediate changes from 6 o’clock tonight, but no doubt the tax burden on all of us will increase again, despite any “sweeteners” announced today, almost certainly for a low key implementation sometime next year.

 

Written by: Colin from KSV

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