Sugar tax on soft drinks to miss target by £280million

THE amount raised by the Government’s sugar levy on soft drinks will be £280million less than expected.

The tax, which comes into force on April 6, was originally expected to raise £520million in 2018-19, but this has been revised down to £240million.

Ministers had promised that funds would be diverted to support school sports – aiding the fight against obesity.

The fall has raised fears that schools will not get the windfall, but the Treasury says it will honour the commitment.

The drop in income is a result of more than half of drinks firms planning to cut sugar content and avoid their products carrying the levy.

AG Barr, the makers of Scottish fizzy drink Irn-Bru, sparked uproar earlier this year after changing its formula. It has replaced sugar with controversial sweeteners aspartame and acesulfame K.

The levy works out at 24p per litre on soft drinks which contain more than 8g of sugar per 100ml. It is a lower 18p per litre for drinks with 5g-8g of sugar per 100ml.

The Office for Budget Responsibility said the figure was first revised last March to ‘reflect producers reformulating their drinks sooner and more aggressively than originally assumed’ and had now been revised again to £240million.

Wetherspoons boss Tim Martin has blasted Jamie Oliver’s campaign for a sugar tax on soft drinks, claiming it has cost the chain £3million a year. But he said the TV chef ‘couldn’t afford to pay it himself’ after closing 12 of his 37 Jamie’s Italian restaurants.