The Scottish Licensed Trade Association has joined other trade groups and corporate bodies to urge the UK Government to can the soft drinks tax.
‘Face the Facts, Can the Tax’ is supported by a coalition of British businesses who have come together to highlight the damaging economic consequences of the tax and urge the Government to rethink the policy and focus instead on proven solutions that will address obesity.
This new campaign from businesses employing more than 400,000 people across the country has been launched calling on the UK Government to reconsider the soft drinks tax. Members of this coalition include manufacturers, wholesalers, retailers, and licensed trade groups.
The group includes soft drinks manufacturers, wholesalers, small shops, newsagents, restaurants, bars, and pubs. They are warning the tax will do nothing to tackle obesity, and risks causing thousands of job losses and higher prices for those who can least afford it.
The launch comes as a new report from Oxford Economics has highlighted the worrying economic damage the proposed soft drinks tax will have on British industry. The report predicts a loss of more than 4,000 jobs across the UK and a decline of £132 million in economic output.
The same report predicts that calorie consumption will drop by just five calories per person per day as a result of the tax – the equivalent of a bite of an apple. Meanwhile, between 2004 and 2014, sales of ‘full sugar’ soft drinks fell 44%, and now contribute less than 3% of calories in the diet, yet obesity increased by around 4% in this same period.
The group recognise tackling obesity is a major public health challenge in the UK. The group wish to work with the Government and other stakeholders to deliver effective and holistic policy solutions.
However, the tax will not solve obesity and will instead result in job losses and higher prices when Government should be focused on meaningful measures to tackle obesity and supporting UK businesses and consumers.
Paul Waterson, Chief Executive of The Scottish Licensed Trade Association said:
“The latest SLTA business insight survey of over 800 Scottish licensed premises published in June, showed operators are very pessimistic about trade going forward.
Put simply – the drink driving regulations introduced in Scotland in December 2015 have had a major negative effect on the business. Our survey showed that one of only two growth categories in our sector was soft drinks. This unwarranted tax will erode that growth and put further pressure on declining profits, yet do nothing to alleviate health concerns.
75% of contributing pubs and bars told us that the biggest challenge facing their businesses was government intervention.
If this discriminatory, unfair government initiative goes ahead it will show their fears are well founded.”
Gavin Partington, Director General of the British Soft Drinks Association who are providing funding for the campaign said:
“We absolutely agree with the Government that obesity levels are too high and action is needed, but burdening businesses and consumers with an ineffective tax is not the answer.
“We know from the evidence around the world where they’ve tried a tax that it will not make a difference to obesity. What it will do, as this report shows, is damage thousands of businesses across the entire soft drinks supply chain, from farmers, to manufacturers, to convenience stores and the pub and restaurant trade.
“At a time of economic uncertainty the Government needs to be supporting these businesses and working with industry to support actions that are already making a difference, such as reformulation, smaller packs, and more marketing of the many no sugar options now available.”
Kate Nicholls, Chief Executive, Association of Licensed Multiple Retailers said:
“The introduction of a tax on sugary drinks will increase costs burdens for businesses and consumers and we do not believe it will be the ‘silver bullet’ that will tackle this country’s obesity problems.
“Eating out is an occasional treat and pubs and restaurants have worked hard to reformulate menus, reduce calories and provide customers with greater choice and nutritional information. Those efforts are ongoing, as part of the sector’s wider promotion of responsible consumption. An additional cost burden is unlikely to help in this regard.”
James Bielby, Chief Executive, Federation of Wholesale Distributors (FWD) said:
“Soft drinks are worth £1.8bn in sales to wholesalers serving retailers and caterers and is a vital category for the sector. Introducing a levy on soft drinks in the UK creates a new opportunity for unscrupulous importers to bring tax-avoided products into that supply chain. This would hugely disadvantage British manufacturers and wholesalers and is just one of the many unintended consequences of using such a blunt instrument to change consumer habits.”
Paul Baxter, Chief Executive, the National Federation of Retail Newsagents said:
“Our members are small business owners that are struggling to make ends meet in a very difficult economy.
“Piling on more ill-thought-out policies that will only make things more difficult for retailers while doing nothing to address the serious problem of obesity does not make sense. This Government must rethink the approach.”
Brigid Simmonds OBE, Chief Executive, British Beer & Pub Association said:
‘Soft drinks are an important part of the sales mix, and are a great choice for drivers. The new tax further increases the burden of taxation on pubs – and will push up prices of soft drinks for pub goers.
‘With research from Oxford Economics showing up to 1,800 jobs in the pub and restaurant sector alone are at risk from this tax, the Government should think again about this unnecessary burden on our nation’s pubs.’
Pete Cheema, Chief Executive, Scottish Grocers Federation said:
“This measure by the former Chancellor completely ignores the efforts taken by the soft drinks industry to reformulate their products, promote low or no calorie alternatives, and the commitment not to advertise high sugar soft drinks to under-16s.
Additionally – and of great concern to retailers –this is likely simply to pass on the cost to consumers and further put at risk the viability of independent convenience stores in Scotland.’’
Jonathan Hart, Chief Executive, Automatic Vending Association (AVA) said:
“Recent improvements in product labelling have already helped consumers control their calorie and sugar intake more effectively than before. We believe further transparency on product labelling and increased education on nutrition will achieve results which are long-lasting and effective – unlike a sugar tax, which would have serious negative consequences for the businesses of many of our members.
With greater access to nutritional guidance and information, consumers will be able to make educated, well-informed choices helping them maintain a well-balanced diet where fizzy drinks containing sugar can be enjoyed in moderation.”
Paul Kenward, Managing Director, British Sugar said:
“We question if a tax is the appropriate measure. Tax is often used by Governments to reduce consumption, but in this case there is no credible evidence that a sugar tax will prompt a change in consumer behaviour. Even if it did, current Government data show that total sugar consumption has fallen by 12.5 per cent since 2001, while obesity rates continue to rise. This highlights that obesity is a complex issue and what is required is collaborative action to find real and workable solutions to tackle this complex issue.”
Mr. William Martin, Chairman, National Farmers Union, Sugar Board
“I am not disputing for one minute that we have a problem with obesity, what I question is the effectiveness of this tax in addressing the issue.”