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The global trend to tax sugary drinks was a key focus of the two-day Ausdrinks Regional Beverages Summit in held in Sydney recently.

Several countries are now looking at taxing soft drinks, and leaders described the surprise decision by the UK government to introduce such a tax as a step in the wrong direction in the fight against obesity.

Just days before the gathering of global beverage industry professionals assembled in Sydney, Britain announced it would introduce a sugar levy on soft drinks in two years' time.

Richard Hall, chairman of research firm Zenith International, told attendees the UK tax could see some prices double.
At the same time, he noted that so many other sugary products were excluded.

"Obesity is a much bigger problem than can’t be solved by one tax on one product group," he said.

Hall also said that, although soda taxes raised money for governments, they had the potential to delay real action to tackle obesity by years.

"Obesity still needs broader action,” Hall said.

"Soft drinks tax could prove an illusory diversion."

Australian Beverages Council CEO Geoff Parker said, in terms of discretionary foods, soft drinks ranked only seventh in kilojoule contribution.

“Soft drinks contribute just 1.7 per cent of our daily intake of kilojoules,” Parker said.

He also pointed to research from the McKinsey Global Institute that found that a 10 per cent tax on high-sugar products would be one of the least effective measures in combating obesity, ranking 14th of 17 intervention methods.

“There is still no evidence globally that a soft drink tax has any impact on obesity rates,” he said.

“In fact, other European countries, like Denmark, have introduced and subsequently repealed a ‘fat’ tax within 18 months due to its blatant ineffectiveness.”

The UK levy will be imposed on beverage companies and is calculated according to the sugar content in drinks. It is expected to raise about 500 million pounds ($704m) per year.

After the announcement, celebrity chef and sugar tax campaigner Jamie Oliver posted an online video urging other countries to do the same.

Meanwhile, soft drink manufacturers are reportedly considering whether to mount a legal challenge against the UK government on the grounds that it is discriminatory, as it will not affect other beverages with a high sugar content, like milkshakes, fruit juice or coffee.

There are concerns soda taxes could also translate to job losses in the non-alcoholic drinks manufacturing sector, which in Australia alone employs around 46,000 people.

“Soft drinks can be enjoyed in moderation,” Parker said.

“Food and beverage consumption is a personal choice, not a revenue raiser.”

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