Pre-packed milkshakes and coffee which contain high sugar content will be hit with an additional tax from 2027. This comes after the Health Secretary announced an extension on the tax on fizzy drinks to include some milk-based products.
Wes Streeting spoke to Parliament about his intention to lower the threshold for which the tax would apply from 5g to 4.5g per 100ml. This is part of a bid to tackle obesity in children. Popular products, including Starbucks’ Caffe Latte, along with some drinks advertised as being high in protein, will be among the affected.
The sugar tax was introduced by the Conservative government in 2018 to cut down on sugar consumption and give manufacturers an incentive to reduce the amount of sugar they use in their products. It applies to products in cans, cartons, and other packaging, but so far had not covered drinks sold over the counter or in cafes such as milkshakes.
There will also be a “lactose allowance,” accounting for the naturally occurring sugar in milk. This means that some of the sweetness in some milk-based drinks would not count towards the total sugar when determining the tax.
Fruit juices, alcohol-free beer, wine, and meal replacement drinks are not covered by the tax. Many milk-based products were not covered because of the calcium they provide. Drinks made using plant-based milk, including soy and almond milk, will be treated in a similar way to dairy-based products from 2028.
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