Sugar tax leaves sour taste for local retailers.

Wednesday, 11 April 2018

Sugar tax leaves sour taste for local retailers. thumbnailChris Campbell, of Spar in Loughbrickland, with some of the products affected by the tax.

LOCAL retailers are not convinced by the new sugar tax.

The new prices came into play on Friday (6 April) with retailers across the UK removing the price code on certain drinks and replacing them with a higher price.

It's all thanks to the UK government's implementation of the sugar tax which means that manufacturers now have to pay a levy on the high-sugar drinks they sell.

Some feel that this step is already a success as many firms have reduced their sugar content ahead of the change.

Ribena cut their sugar content from 10g to less than 4.5g per 100ml, Lucozade from 13g to less than 4.5g per 100ml and Irn-Bru decreased their sugar content from 10.3g to 4.7g per 100ml.

Coca-Cola have made no changes and they remain at 10.6g per 100ml and Pepsi remains with a sugar content of 11g per 100ml.

Originally the Treasury forecast it would raise more than 500m a year but due to manufacturers such as Ribena, Lucozade and Irn-Bru already reducing their sugar content, this figure has more than halved to 240m.

The initiative will see drinks with more than 8g per 100ml have a tax rate equivalent to 24p per litre and drinks with 5-8g of sugar per 100ml will have a lower tax rate of 18p per litre.

Drinks with a high milk content and pure fruit juices are exempt as they do not contain added sugar.

Managers from two local stores however are not convinced that the government's plan which has already been introduced by other nations including Norway, Mexico and France will have any positive impact.

Chris Campbell, manager of the Spar, Main Street, Loughbrickland is worried that the price increase could have a detrimental effect on sales.

We spoke to Mr Campbell on Friday morning, the day the changes were brought in.

He explained: "I had a briefing with all our employees this morning as all of our staff had to be made aware of what was happening.

"Some of them were already aware of the sugar tax coming into force today and others were not. Some members of our team relayed to me that they are concerned they will get the brunt of any annoyance from consumers at the tills due to the price increase on some drinks.

"They are worried that people may just think it is our store bumping up prices and not understand that this is a UK-wide initiative." Mr Campbell is unsure whether the sugar-tax will have a positive impact: "It was the same with the cigarettes and we have no statistics yet to show if raising the price of cigarettes and keeping them from consumers' view has had a positive impact.

"The sugar tax means more work for retailers and I do think it could have a negative impact on sales in my opinion, from what I have seen today I am not sure whether it will bring about the right kind of change needed."

The same worries were felt by Kevin Dunne, manager of O'Hare's Eurospar in Rathfriland.

Mr Dunne said that while these are still early days he doesn't believe the initiative is going to work.

"As retailers we have no control over the price increase and I don't believe it will put people off buying fizzy drinks.

"Of course I can see where they're coming from, the principles and the idea are right, the government wants to tackle obesity but I just can't see it working.

"We currently still have offers on our Fanta and Sprite but this will be the last on the big two-litre bottles.

Coca-Cola are dealing with the change by stopping all production of two-litre bottles for the UK, so the biggest size you will be able to purchase will be the 1.5 litre."

Mr Dunne concluded: "I can't see an extra 10 or 15 pence putting people off buying a drink."


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