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Question 1

Sugar tax

The soft drinks industry levy (SDIL)

Answer 1

• Levy applied to UK-produced or imported soft drinks containing added sugar
• Announced in Osborne’s March 2016 budget and came into force from April 2018
• 24p per litre on soft drinks containing more than 8g of sugar per 100ml.
• Introduced as an anti-obesity policy. It was central to the 2016 Childhood Obesity Strategy
• Success: The total sugar sold in soft drinks by retailers and manufacturers decreased by 35.4% between 2015 and 2019
• However: Excess weight and obesity in the UK continued to increase

Question 2

Tobacco duty

Answer 2

Price of a packet of 20 cigarettes = pre-tax price + 16.5% ad valorem + £6.33 of duty tax + 20% VAT
- Average price = £16. 80% of that price is tax
- Someone smoking three packets of cigarettes per week will be paying over £1,100 per year in tax
- In 2022/2023 tobacco tax revenue raised £10.04 billion
- The level of smoking in the UK is 14.7%