Taxation of unhealthy lifestyle choices, such as alcohol and tobacco, is a fixed way of raising income in the UK. Taxing sugar is no longer that simple. Sugars found in vegetables or fruits are an essential component of our diet. We are harmed by simple sugars, included among others in so popular sweetened soft drinks. However, we also suffer from excessive tax burdens.
A Sweet Crisis Destroys Society
Obesity-related diseases represent a large and ever-increasing percentage of diseases whose treatment is financed by the state budget. They absorb one million almost worldwide and in almost every currency available. Medical environments, both national and international, have been alerting for several years to the rise in this problem.
However, despite promoting a healthy lifestyle and the good impact of physical activity, this problem is growing. It is stressed that the growing consumption of sugar is driven by extremely popular sweetened soft drinks, everywhere available and loved by most people.
There is no need to mention specific names, they throw themselves in the eyes of the store shelves, where they stand nicely packed, in the reach of the hand, easily accessible, and at an affordable price for each of us.
Among other things, sugar contained in coloured drinks is inextricably linked to the obesity epidemic, which exterminates British society. The government in Britain decided to tax it.
Sugars found in vegetables or fruits are an essential component of our diet. We are harmed by simple sugars, included among others in so popular sweetened soft drinks. However, we also suffer from excessive tax burdens.
Already in 2013 a study was published in the British Medical Journal showing that 20% tax on sugar-sweetened beverages will reduce obesity in the UK by about 1.3%. However, due to the need to distinguish the above mentioned two types of sugar (say good and bad), it was decided to strongly specify the requirements for taxed products. Thus, "sugar tax" is a sugar tax, also called Sugar Sweeted Beerage Tax (SSBT).
Lower sweetness levels
In March 2016, After years of debate, the UK Chancellor announced that a number of consultations were planned in the budget to implement a plan called "Soft Drinks Industry Levy". It was a new non-alcoholic drink charge. The plan would come into force in April. 2018.
This idea was supported at the time 60 Health Organisation, Simon Stevens, Head of the National Health System (Chief Executive of NHS England), Dame Sally Davis – Head of Medical Officer for England, Sarah Wollaston – Chair of Health Election Commission, Professor Mark Hanson of the British Heart Foundation and Chris Askew – Executive Director of Diabetes UK.
The press immediately announced this "introduction of a sugar tax" 1 . There was talk of harmful simple sugars (bad sugars) contained in non-alcoholic beverages, the subject became extremely medial. There were both voices of support and fierce criticism.
For example one from the members of Parliament, Will Quince described the idea as "protective, regressive and impractical" and as a symptom of "nannies" of citizens on the part of the state in its worst edition. 2
The plan envisaged the spread during the introduction of the ‘sugar tax’. Within 2016 wide public opinion surveys were carried out, in the year 2017 there has been legalisation by introducing the charge in question into the system as part of the Financial Act for the same year, with the assumption that it would not enter into force until April 2018. And so here in Britain since the day 6 April 2018 „sugar tax’ will be imposed on producers and importers of beverages.
The media reports that the new tax has already had its intended effect. Companies such as Tesco and AG-Barr accelerated work on changing the formula of their drinks to reduce sugar levels before the new regulations came into force, that is, before April 2018.
Sugar tax will finance sport
The additional charge will be made on the basis of the volume of sugar-sweetened beverages produced or imported. This issue concerns not only local suppliers of such beverages but also foreign ones. For example, for beverages with a total sugar content of up to 5 grams per gram 100 The milliliter fee will not be charged at all.
For beverages with a total sugar content above 5 grams per gram 100 a millilitre fee will be charged at the basic rate (it is expected to be 18 pence on point (r), in the case of beverages with a total sugar content above 8 grams per gram 100 millilitres will be charged at a higher rate (i.e. 24 pence for point (r).
Operators of such beverages will have to register and pay appropriate fees. Registration is to take place within 30 days from the end of the month in which the beverages were sent or imported to the United Kingdom or when more than one million point (r) The last 12 calendar months. Registration will take place on the first day of the month following the month in which registration was required.
For each 100 millilitres of drink sold in the UK and Ireland, containing 5 or 8 grams of sugar, you will have to pay the VAT at the same time as this "sugar tax". It is estimated that an additional state revenue of close 1,000,000,000 GBP a year to be allocated to the financing of sport in British schools.
At this point, it is worth mentioning that this kind of tax already applies in Norway, Denmark, France, Hungary, Mexico, South Africa, the Philippines or even the United Arab Emirates. According to reports from the press, Polish ministries of health and finance do not consider such a solution.
And to quote, finanse.wp.pl:„This tax is intended to reduce the public's weight and to "fatten" by means of state funds – therefore I would not personally rule out that soon Polish producers or importers of sweet drinks will have to face "sugar tax". I think it'll be good for everyone.
Trivia
In 1764 The British Parliament passed the so-called Sugar Act (more known as the US Income Act) which aimed at preserving the sugar industry in some British colonies by increasing the duty on imported sugar. It was one from the factors contributing to the riots that led to the American Revolution. Although the tax on soft drinks is already controversial, it is unlikely that it will have such long-term consequences, such as the Sugar Act. But let's not forget history.
She wrote: Dobrawa Zelwiańska – Legal assistant
Regardless of the issue of social responsibility currently under discussion of a possible solution in the area of harmful food taxation, the current legal situation and the associated uncertainty about the consequences have a very negative impact on the food industry.
Comment by Leszek Dutkiewicz, Director of the Office Russell Bedford, in Katowice
Concerning the subject matter of sugar tax in the context of the work of the Polish legislature, it should be noted that some attempts to regulate the level of consumption of so-called "harmful foods" have been and are being taken, and some have already left lasting effects in our tax system.
On the one hand, have not yet decided on comprehensive solutions that would be clearly tax-sensitive for harmful food products. Solutions such as the said sugar tax or fat tax, which entail an additional tax burden linked to the presence of substances considered harmful.
On the other hand, Some examples of a differentiated approach to the taxation of food products are clearly seen in the example of VAT rates. Reduced rates are very often applied to food products 5% or 8%, which have been introduced by way of exception, indicating the product categories in the relevant annexes to the Act.
Whether a reduced rate can be applied to a given product depends to a large extent on which PKWiU code the product is designated.
Looking at the annexes and the categories of products indicated in them, one can get the impression that the intention of the legislator was to tax the higher rate of unhealthy products, such as deep-fat fried products.
However, in many cases the classification is not clear, so taxpayers make interpretative proposals to both tax authorities and statistical authorities. The result is the application of differentiated taxation to similar products, such as potato chips (8%) and corn chips 23%). There are definitely more of these examples.
In fact, absurd situations arise, which are partly due to the lack of transparent regulation, while the high level of activity of taxpayers in trying to obtain official confirmation of the application of the appropriate rate, where authorities in many cases state that it is primarily up to the manufacturer to determine the composition of the product and to classify it to statistical needs.
However, in the case of tax controls, tax authorities may challenge the correctness of the rate applied by the taxpayer and the full financial burden of any divergences in 100% rests on the taxpayer.
Regardless of the issue of social responsibility currently under discussion of a possible solution in the area of harmful food taxation, the current legal situation and the associated uncertainty about the consequences have a very negative impact on the food industry.
1 https://www.independent.co.uk/news/uk/politics/budget-2017-sugar-tax-philip-hammond-fight-obesity-child-weight-gain-fizzy-drinks-a7618316.html
2 Sarah Neville 17 March 2016), "UK tax on sugar drinks is 'nannying' and 'impractical', Financial Times
Author:
Dobrawa Zelwiańska
Lawyer. She graduated from the Faculty of Law and Administration of the Cracow Academy of Frycz Modrzewski in Krakow and from postgraduate studies in medical law, bioethics and sociology of medicine at the Faculty of Law and Administration of the University of Warsaw in Warsaw.
Diplomat mediator – she has completed postgraduate studies in mediation - alternative methods of dispute resolution at the Faculty of Marketing and Management of the AGH University in Krakow. He deals with medical law and obligation law on a daily basis.