Tax and Fiscal Policy

A sugary drinks duty: a tax grab with no health benefits


Press Release

HS2 has a very weak business case

Press Release

Governments should not dictate development priorities

IEA responds to a new report calling for a tax on sugary drinks

Ahead of a new report out today which calls for a sugary drinks duty to be implemented in the 2013 Budget, Christopher Snowdon, Research Fellow at the Institute of Economic Affairs, said:

“This is just another tax grab which, by Sustain’s own admission, will cost hard-pressed consumers £1 billion a year. The government should learn the lessons from Denmark, where a ‘fat tax’ was abandoned only two months ago because it was an economic and political disaster which did nothing to improve health. The only Western country to have taxed soft drinks for any length of time is the USA where the sky-high obesity rates bear witness to the ineffectiveness of these sort of measures.

“Governments often promise that the proceeds of stealth taxes will be “ring fenced” for various projects but, in reality, this almost never happens. Much of the money will be swallowed up by whichever new quango is created to deal with the headache of deciding which products are ‘unhealthy’ and which are ‘sustainable’.

“A campaign to make people pay more for their food and drink at a time when Britain is looking down the barrel of a triple dip recession just shows how out of touch these single-issue pressure groups are. As usual, it is ordinary people—and especially the poor—who will pay the price if this misguided experiment in social engineering is adopted by the government.”

Notes to editors:

To arrange an interview with an IEA spokesperson, please contact Stephanie Lis, Director of Communications: 020 7799 8909, [email protected]

This new report, ‘A Children’s Future Fund – How food duties could provide the money to protect children’s health and the world they grow up in’ will be published by Sustain and is available to download here from Tuesday 29 January.

The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.

The IEA is a registered educational charity and independent of all political parties.