Chancellor George Osborne might be facing legal challenges regarding the implementation of the new sugar tax. Giant soft drink companies are now considering filing a lawsuit against the government.
According to Sunday Times, the proposal will place Osborne on a collision course with some of the world's most powerful companies. The legal challenges are now being drawn up by Coca-Cola and other drink makers against the law which is expected to be imposed in two years' time. The proposed tax revisions will raise the budget to about 500 million pounds a year.
The companies, however, are disputing this new regulation because other beverages with very high sugar content such as fruit juices and milkshakes are exempted from the new law. As reported by the Telegraph, a senior expert in the industry said it is pretty clear that the tax would be challengeable because of the discrimination it makes against some producers who will be free from selling sugary drinks.
Government officials on the other hand are in constant talks with the drink manufacturers in order to avoid any legal battles. Companies like Irn-Bru, Britvic and Coca-Cola are said to be involved with the negotiations. The food industry is also supportive of the challenge due to the mounting possibility of sin taxes on sugar in foods as per Daily Mail.
Similar taxes were imposed in countries like Finland and Denmark but was successfully challenged forcing the European judges to block the plan of Scotland to apply a minimum pricing per unit on alcohol.
However, the proposal of the new tax form for sugary drinks has been a welcome development for health professionals. They have been constantly pointing out that it cost the NHS 13.8 billion pounds to help treat obesity and diabetes in the country and are putting the blame on soft drinks.
Gavin Partington, the Director General of the British Soft Drinks Association, said the industry has already agreed to cut the calorie content of their drinks. He added that imposing these sugar taxes has not been effective in other countries. He reiterated that it is not only the soft drinks that increase the calorie and sugar intake of consumers but also other take home food that are increasing as well.
