Soft Drinks Industry Levy (SDIL)

A drink is liable to the levy if it meets all of the following conditions:

• it has a content of 1.2% alcohol by volume or less
• it is either ready to drink, or to be drunk it must be diluted with water, mixed with crushed ice or processed to make crushed ice, mixed with carbon dioxide or a combination of these
• it is packaged ready for sale
• it has had sugar added during production, including pure cane sugars like sucrose and glucose as well as substances (other than fruit juice, vegetable juice and milk) that contain sugar, such as honey
• it contains at least 5 grams (g) of sugar per 100 millilitres (ml) in its ready to drink or diluted form

Drinks with total sugar content above 5g per 100ml will be taxed at 18p per litre and drinks above 8g per 100ml at 24p per litre. This is the equivalent of 6p on a standard can of Fanta or Sprite, or 8p on a can of Coca-Cola and Pepsi.

Why has the SIDL been created?

The main reason for the tax is to try and reduce obesity in the hope that the increased cost will stop people from buying fizzy drinks as often, and therefore consuming less sugar. It’s also designed to offset the growing cost of treating obesity and related issues.

In England, the new levy revenue will be invested in giving school-aged children a brighter and healthier future, including programmes to encourage physical activity and balanced diets. For Scotland, Wales and Northern Ireland, the Barnett formula will be applied to spending on these new initiatives in the normal way.

A drink is exempt if it meets one of the following conditions:

• it contains at least 75% milk
• it’s a milk-substitute which contains at least 120 milligrams of calcium per 100ml, for example soya or almond milk
• it’s an alcohol replacement drink, for example de-alcoholised beer or wine
• it’s infant formula, follow-on formula, baby foods, formulated food intended as a total diet replacement or dietary food used for special medical purposes

You can reformulate your drinks to reduce the sugar content, which may either reduce or remove your drinks’ liability to the levy.

For further information click here