Soft drink giants, including Coca-Cola and Irn-Bru maker AG Barr, have urged Prime Minister Sir Keir Starmer to scrap Chancellor Rachel Reeves’ proposal to toughen the sugar tax, warning it could push prices up by as much as 5%.
In a joint letter coordinated by the British Soft Drinks Association (BSDA), more than 10 leading manufacturers said the move would add £220m in costs to the industry, undermining business confidence and threatening investment.
The plan would lower the sugar content threshold for the Soft Drinks Industry Levy from 5g to 4g per 100ml, meaning products reformulated to avoid the tax since its 2017 launch would now be caught.
“This couldn’t come at a worse time,” the firms wrote. “Prices will inevitably rise to cover these costs, and long-term growth will suffer.”
The companies warned that a 5% rise would add around 75p to a 24-can box of Coca-Cola or 30p to an eight-pack of premium tonic.
They argued the health benefits would be minimal, with the average calorie reduction per person equating to half a grape per day.
According to the BSDA, the change risks will cost the economy £1bn annually by 2030 through lost investment, while offering little return in NHS savings.
The letter also accused the Government of shifting the goalposts for the third time in eight years, “sending the wrong signal about the stability of UK policymaking.”
Ms Reeves is still consulting on the proposals, with a final decision expected in the Autumn Budget on November 26.
A government spokesman defended the levy, saying it had already halved sugar in soft drinks and played a key role in tackling child obesity.
