The Sugar Tax: One year on

Food & Drink | Legal | Reports

In 2016, the NHS found that 26% of adults were obese – a rise of 15% since 1993. Meanwhile, the number of people diagnosed with diabetes in the UK has more than doubled over the past twenty years. Diet-related diseases are putting a strain on society, and it isn’t sustainable. It’s clear that action needed to be taken.

The government’s so-called ‘sugar tax’ – a levy of 18p or 24p per litre on drinks with either 5g of sugar per 100ml or 8g per 100ml respectively – recently celebrated its first year anniversary. But what has been its impact on businesses and consumers and is there scope for more change?

Impact on businesses

Businesses have been forced to adapt to the sugar tax legislation and have made a number of changes to get in line. Some have brought out lower sugar ranges such as Coke Zero, and Irn-Bru which cut its sugar content by half. Irn-Bru’s manufacturer, AG Barr, has however replaced sugar with an artificial sweetener, aspartame. Many of these refined products aren’t fit for purpose regarding the aim of helping people be ‘healthier’. Other businesses have revamped their retail models, for example restaurant chains Pizza Hut and TGI Fridays have stopped offering free soft-drink refills.

The new Irn-Bru formula cost AG Barr £1.4 million in 2017 and these costs – either through the levy directly or via other means – are often being passed along the supply chain. As a result, the tax has also had a big impact on restaurants, retailers and pubs, with these businesses forking out more money to cover the tax and, in many cases, passing on the cost to consumers. Wetherspoons has said that the tax cost them an additional £3 million per year.

It would be interesting to know how many businesses have truly learned any real, long-term lessons about public health – rather than testing their profit-safeguarding abilities. We are all in the war against sugar, but there are winners and losers. Businesses in the industry we have an ethical responsibility to make sure that it’s consumers who come out on top.

Impact on consumers

Grenade®’s consumers are often savvy about the risks of a high sugar diet, and that’s why they choose our products as healthier alternatives. All of our products including shakes, spreads and bars, are formulated with low sugar and high protein, without compromising on taste. As such, the sugar tax hasn’t impacted Grenade®.

Our ethos aside, it’s great that healthier snacking options are available for consumers. However, a large portion of consumers are still not benefitting from the sugar tax. According to a report by Nielsen, 62% of UK shoppers have not changed their consumption behaviour in any way since the levy was introduced on drinks.

Brands such as Coca Cola and Pepsi have refused to reduce the amount of sugar in either of the classic versions of their drinks – so consumers aren’t seeing any of the benefits of the sugar tax – they’re just paying more for the same thing. Unfortunately, it seems some brands are just capitalising on loyal consumers who are happy to absorb the additional costs and overlook healthier alternatives.

What next?

Sales of sugary drinks have been falling for some time now and yet, obesity rates continue to rise. It’s clear that a broader approach to overhauling eating habits is required to have any real, lasting impact on consumer health; and it seems two-thirds of consumers (69%) agree that the tax should be extended to confectionary and biscuits.

The sugar tax is a step in the right direction, but solely relying on a reduction on sugary drink intake will not have a significant enough impact on the current obesity crisis. We need tougher restrictions, more transparent food labelling, more consumer awareness from an early age and food brands also need to start taking their influence on consumers’ health, mindset and wellbeing seriously.

I believe the sugar tax is and will continue to be a positive force for tackling obesity and improving health, firstly by reducing the amount of sugar in our diets and secondly by making consumers more aware about how they fuel their lifestyles – whatever that may be.

That’s why Grenade® waged war on unhealthy snacks by launching our ‘Snacking Revolution’ campaign last year. The campaign is designed to inform and educate consumers about their snacking options and the benefits of healthier alternatives to fit their own individual lifestyles. I urge the government and other businesses in the industry to take on the same responsibility and join the fight against obesity in all its forms.

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