Coming to a Cineworld near you: sugar tax on Pepsi

Wednesday 01 August 2018

Islanders wishing to sip Pepsi while watching a movie on the big screen will soon have to fork out an extra 20p as Cineworld in Jersey has decided to pass on a UK sugar tax.

The sugar tax, also known as the Soft Drinks Industry Levy, was brought in in April to help reduce sugar in soft drinks and reduce childhood obesity - but it does not apply in Jersey.

The tax is paid by drinks companies and depends on how much sugar the drink contains. If there is eight grams of sugar per litre, the company has to pay 24p per litre, if the sugar is between five and eight grams per litre, the company pays 18p per litre .

The UK government explained the aim of the tax was to encourage companies to cut the sugar in their soft drinks. Since the levy was announced two years ago,  over 50% of manufacturers have done that bringing the expected amount of revenue from £520m in Year 1 down to £240m. 

While some have cut back, the manufacturers of Pepsi Regular, which contains around 11.6 grams of sugar per litre making it one of the most sugar heavy drinks on the market along with Coca-Cola, have decided to stick to their recipe. 

Pictured:  Some drink manufacturers have changed their recipe to reduce the amount of sugar in them and avoid the new tax.

This has prompted the Cineworld Group to charge an extra 20p to their customers choosing "full sugar" Pepsi in all their cinemas in the UK, in Ireland, and even in Jersey. A spokesperson said: "While we recognise that the sugar tax does not apply to Jersey, this additional charge has been introduced across all Cineworld cinemas in the UK and Ireland. This is in part due to an increase in supplier costs as the product is sourced in the UK so an additional levy is now payable."

The cinema group however added that the decision was also a big part of their ongoing effort to encourage customers "to try sugar-free or other alternatives without removing customer choice."

A spokesperson added: “It’s also worth noting that all of our other drinks are exempt from the additional charge which is also discountable to our Unlimited customers. Customers are also welcome to bring cold food and non-alcoholic drinks with them to the cinema."

Pictured: The Co-Op said they have no plans to charge the sugar tax to their customers.

But you will still be able to buy your Pepsi 'sugar tax free' in local shops. Mark Cox, CEO of the Co-Op, assured Express that there was no plan to charge the sugar tax to islanders in their stores. "It is our duty to reclaim the tax and the administrative burden falls on us to make sure we get it back from the UK. We wouldn't apply on our customers a tax that doesn't apply here."

The sugar tax will not impact retail prices at Waitrose either. 

Simon Moore, Waitrose Director of Technical & Corporate Social Responsibility, said: “We’re focused on giving our customers choice. Instead of simply swapping all sugar in our own label soft drinks for sweeteners - which some of our shoppers tell us impacts the flavour - we’re offering reduced sugar alternatives of our original recipes alongside sugar-free options containing sweeteners.”

Gareth Bowen, Trading Manager at Alliance, confirmed that the tax won't affect their customers. He said: “We do not plan to pass on any additional costs related to sugar tax in the UK. Most drinks from our main suppliers have been reformulated to be below the sugar tax threshold, which was one of the main aims of introducing the sugar tax.” 

Pictured: Local pubs will not charge their customers for the sugar tax.

Local pubs and restaurants will also not be dishing up the sugar tax to their customers. Gavin Reid, Managing Director at Randall's, said: "We have no intention to increase our mineral prices, however if the States ever introduced a sugar tax then we would obviously need to review how it impacted us and then reconsider, as any business would do if they are imposed with additional new taxation."

The Liberation Group have taken a different approach to avoid the burden of the new tax. They have turned off the tap on regular Pepsi and now only sell Pepsi Max, which contains no sugar. Mark Crowther, CEO of the Group, said: "It is a health thing as well, it's good to reduce sugar in people's lives. We have worked with our suppliers, including Britvic, who have reconstituted their products so that they fall under the limit. The sugar tax has not really been an issue for us and we have no plans to increase our prices."

While sugary drinks are safe from an extra tax for now, it might not last. The States' Food and Nutrition Strategy revealed last year that the Health Department was working with colleagues both in the UK and in Guernsey towards adopting a sugary drinks tax in Jersey.