Ireland’s sugar tax implemented
Ireland has introduced its tax on sugar-sweetened drinks this week, with legislation coming into effect on May 1.
The Sugar-Sweetened Drinks tax applies to water and juice based drinks with an added sugar content of more than 5g per 100ml. Pure fruit juices are exempt from the tax, as are dairy products on the basis of their nutritional value.
There are two rates of tax: the lower rate of 20 cents (USD 24c) per litre applies to drinks with 5g-8g sugar per 100ml; and a rate of 30 cents (USD 36c) per litre applies to drinks with 8g or more of sugar per 100ml.
The rates correspond to the UK’s sugar tax (18p for the 5g-8g category and 24p for the 8g or more category).
The tax is estimated to yield around €40m ($48m) a year. However, the Irish government says it expects this figure to reduce over time as the industry reformulates and consumers turn to reduced sugar options.
One in four children in Ireland are overweight or obese.
Paschal Donohoe, Minister for Finance and Public Expenditure and Reform, said: “The sugar-sweetened drinks tax is an important signal to industry to reformulate their products to reduce the sugar content offered to consumers.
“From the consumer perspective, the imposition of a financial barrier on sugar-sweetened drinks will result in reduced consumption by incentivising individuals to opt for healthier drinks.”
The tax had originally been due to come into effect on April 6, coinciding with the introduction of the UK’s sugar tax, but had been put back to ensure the levy would not infringe EU state aid law, a process which is now complete.
Full details on Ireland’s sugar tax can be found here.
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