How Guttridge can help drinks manufacturers to adjust to the sugar tax
The sugar tax was introduced in the UK on Friday the 6th April 2018. It is a controversial new tax that has been brought in by the current government and targets manufacturers of drinks that contain high levels of added sugar.
The stated aim of the new tax is to attempt to reduce the levels of childhood obesity currently being witnessed in the UK, with a quarter of children now considered to be overweight by the time they start school. The UK is not the first country to introduce such a tax, but there are only a few other nations that have done so, including France, Norway and Mexico.
There are in fact two different bands of taxation that have been introduced. For drinks with between 5 and 8 grammes of added sugar per 100ml an 18p per litre tax is now applicable, whereas for drinks with more than 8 grammes of added sugar per 100ml there is a 24p per litre levy to be paid. Drinks with less than 5 grammes of added sugar per 100ml will not be affected by the sugar tax. Manufacturers of fizzy drinks and energy drinks are mostly being affected by the tax, with pure fruit juices being exempt as they are high in natural sugar rather than added sugar, and milky drinks also being exempt because they are high in calcium.
Producers of drinks with high levels of added sugar have therefore had to make a hard decision about what to do going forward. They can pay the levy and absorb the cost themselves, they can pay the levy and pass the cost on to their customers (meaning a substantial increase in the price of the drink), or they can change the recipe of their drinks so that they don’t have to pay the sugar tax. Although some manufacturers are refusing to change their recipes, insisting that their customers like their drinks as they are, surprisingly many more are in fact going down the route of changing their recipe. Originally it was thought that the tax would raise £500 million per year for the government, which they said would go towards funding sports and breakfast clubs, but with many manufacturers of drinks instead reducing the sugar content of their drinks, new estimates are around half of what was originally anticipated, £240 million.
Many manufacturers of soft drinks have been worried about making changes to their recipes and how this would work in practice, but we are delighted to be able to say that we can provide a solution to this problem, and indeed have already successfully provided it to one of the big manufacturers of energy drinks.
We offered a product called a Bulk Bag Discharger as part of our Bulk Bag handling systems. Bulk Bags are often called Big Bags or FIBCs (Flexible Intermediate Bulk Containers), and the use of them has expanded dramatically in the last few years. Bulk Bag Dischargers are designed to safely and effectively unload these large bags and our systems have a wide range of options for efficient Bulk Bag emptying that use an integral weighing, conveying and elevating system, allowing you to discharge materials by weight and combine them with liquid. Our Food Grade Hygienic Stainless Steel construction is ideal for food and drink production, and in particular is an ideal method for drinks manufacturers to add sugar to their products.
Following the introduction of the sugar tax, our client changed the recipe of their drink to include a type of sweetener rather than sugar. This was then mixed with water. “We were unsure initially whether the Bulk Bag Dischargers would be able to cope with this recipe change, as it was expected that it might lead to blockages, but we are delighted to be able to report that it has worked extremely well, that it has not led to blockages” reported the Engineering Project Manager. You can find out more about our Bulk Bag Dischargers by visiting https://www.guttridge.com/eu/en/products/bulk-bag-dischargers. If you are a drinks manufacturer that is looking for an effective solution following the sugar tax introduction, then please contact us.
With a foundation of 50 years of experience, Guttridge is a flourishing company, globally respected for delivering well-engineered, reliable materials handling solutions that continue to anticipate dramatically changing industrial needs.