Sugar Tax in Ireland – Some Details

Budget 2018 saw the announcement of a new “Sugar Tax” which was due to start in Ireland on 6th April 2018. The start date for the new tax was postponed until May 1st 2018  because of the need for EU approval. Approval was finally given on April 24th.

The official name for the new tax in Ireland  is the Sugar-Sweetened Drinks Tax (SSDT). 

A similar tax was implemented in the UK in April 2018 – The official name of the “sugar” tax in the UK is  the Soft Drinks Industry Levy

In Ireland ,  soft drink manufacturers will be taxed according to the volume of sugar-sweetened beverages they produce or import.

Pure fruit and vegetable juices will not be taxed unless sugar is added.  Dairy products will not be taxed either, nor will Soya, nut, cereal or seed based “milk substitute” drinks.
Alcoholic drinks or non-alcoholic beer and wine will not be subject to the new sugar tax either.

If a retailer has purchased taxable product from a wholesaler based outside the ROI; The responsibility rests on the retailer to submit the paperwork and pay the tax to the government.

If companies take the right steps to make their drinks healthier they will pay less tax, or even nothing at all.
It seems that almost all the major soft drinks producers have already reformulated their drinks so that they will fall outside the Sugar Tax. So it looks like the tax has already started to have the desired effect. Consumers in Ireland will probably not see many price increases at all because of the sugar tax

Coca Cola have confirmed that they are not changing the sugar content of their “Classic” Coke – and that there will be price increases on this from May.

There is more information about the tax for for producers or retailers on the Revenue website –  here.

The government estimate that the “sugar” tax collected in 2018 will be in the region of €30 million and in 2019 and subsequent years it will be €40m per annum.  The tax yield will potentially be decreased as drink makers reduce the sugar content and consumers opt for cheaper non-taxed products .


How Much will the Sugar Tax be ?

Drinks with total sugar content above 5g  and below 8g per 100ml will be taxed at 16.26c per litre. (20c inc VAT)
Drinks with more than 8g per 100 ml will be taxed at  24.39c per litre. (30c Inc VAT)

Examples

  • A 330ml can of  Coca Cola containing more than 8g per 100ml will incur a tax of 10c.
  •  A 2 litre bottle of Coca Cola would have a tax of  60 cent. (inc VAT)

Of course – VAT is added to this tax !

Smaller Sizes:
Coca Cola are introducing smaller sizes of their higher sugar  “Classic” version  –   they will be introducing a  new 250ml slimline can and a 375ml  bottle instead of the 500ml.
Coca-Cola Classic multipacks will be available in 4 pack, 6 pack, 10 pack and 20 pack cans.  (No longer 12 or 24).

Coca Cola have told retailers that ….  “new recommended sale prices (RSPs) will reflect the spirit of the government’s sugar-sweetened drinks tax. However, as always, the on-shelf price of products is at the discretion of the company’s retail and wholesale partners.”

sugar tax


4 thoughts on “Sugar Tax in Ireland – Some Details

  1. How will the revenue from the SSDT tax be used? I hope for nutrition education for children in primary and secondary school. And perhaps to supplement the budget of state-sponsored exercise and weight loss programmes. I’ve been web-browsing a few times today and I can’t see any mention of how the money will be spent. -SF, a practicing medical doctor from Naas

    • The only comments we have seen is that expenditure cannot be split by specific types of tax – it wil just get put in the pot with all the rest. Hopefully we will see increased spending in the areas you mentioned in teh coming years.

  2. Am I correct in saying that the tax does not apply to diet drinks. The sweet additives used in diet drinks is far more dangerous to our health and this tax will divert people to diet versions which will cause even more health issues. People should wake up and give up all those toxic drinks.

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