Treasury's Tax on sugary soft drinks comes into force

The Soft Drinks Industry Levy, announced by former chancellor George Osborne in 2016, was originally expected to raise £520m in its first year, with the money to be spent on school sport.

A tax on sugary soft drinks has come into force, with the Treasury having slashed its forecast for the revenue it will raise.

The Soft Drinks Industry Levy, announced by former chancellor George Osborne in 2016, was originally expected to raise £520m in its first year, with the money to be spent on school sport.

That figure has now been revised down to £275m after major manufacturers cut the amount of sugar in popular brands to avoid the tax.

The levy will see drinks containing five grams of sugar per 100ml taxed at 18p per litre, and those with more than eight grams per 100ml taxed at 24p per litre.

The Treasury says the levy will reduce childhood obesity by encouraging manufacturers to cut the sugar content of their products, or to sell smaller amounts.

Major brands, including the manufacturers of Lucozade-Ribena and IRN-BRU, responded by cutting the sugar content of their main products and in some cases replacing them with sweeteners.

Coca-Cola has also cut the sugar in a number of its brands, but is not altering its Classic Coke recipe, meaning a can could cost around 10p more.

Around 60% of the UK population is overweight, with approximately one in-four people obese, and sugary soft drinks account for around 20% of the sugar consumed by children.

Public health bodies say the tax will help tackle levels of obesity, particularly in children.

"We hope it will have two impacts," Deborah Shipton of NHS Health Scotland told Sky News.

Public Health England welcomed the tax, citing new figures which it says show that a child has a rotten tooth removed every 10 minutes in England.

Evidence of the effectiveness of sugar taxes elsewhere in the world is mixed.

Mexico saw an initial reduction in the amount of sweet drinks sold when it introduced a levy, but estimates of the long-term impact of the tax are based on projections of sales had it not been introduced.

There are concerns too that a "pleasure tax" on sugar will disproportionately affect the poorest people.