Soft drink group calls for smoothie/juice tax cut

By Neil Merrett

- Last updated on GMT

Related tags: Fruit juice, Fruit juices, Juice, Tax, Pasteurization

The British soft drink industry has today called on the country's
government to cut Value Added Tax (VAT) on fruit juices in order to
entice more consumers to their potential health benefits.

Industry body the British Soft Drinks Association (BSDA) claims that only 30 per cent of British consumers are eating the recommended five fruits or vegetables a day, and therefore says the government must take action to address the problem. With food and beverage manufacturers coming under increasing pressure by regulators to ensure they are actively encouraging healthier lifestyles and dieting for consumers, a rate cut could be a significant step in meeting these aims. To this end, the BSDA pointed to a recent government report that suggested that 42,000 premature deaths a year could be prevented by a 136 gram a day increase in fruit and vegetable consumption. ​The association claims that a serving or glass of fruit juice would account for this increase, though time and cost are currently serving as barriers to encouraging consumption of the products. "A glass of fruit juice with a meal requires no extra preparation and cutting the rate of VAT would reduce the cost,"​ the BSDA stated. Tax system ​ Under current rules, the BSDA claims that unlike fresh, frozen and canned fruit, which have no VAT imposed on them, juices and smoothie products have to carry the tax, currently at a level of 17.5 per cent. While under European law, the products could not have VAT of lower than five percent, the industry still said the cuts would be an improvement. The budget​ BSDA communications director Richard Laming said therefore that the government needed to take action to help the industry attract consumers through its next budget to be announced on 12 March. "The government rightly wants people to eat more fruit and vegetables because it would be good for their health,"​ he stated. "The chancellor has the opportunity to encourage this by reducing the level of VAT on fruit juice in the budget." ​The BSDA claims were backed by Sue Baic, a spokesperson for the British Dietetic Association (BDA), who said that lowering costs could substantially help to increase consumer intake of fruit juices to meet the five-a-day guidelines. "The BDA encourages the government to reconsider its current high tax on categories of food and drink, including 100 per cent fruit juices and smoothies, that help more people reach this target,"​ she stated. "It seems illogical that fruit canned in fruit juice is rated at zero, but when fruits are pureed or crushed to make smoothies, they carry the full 17.5 per cent VAT charge." ​Stuart Barber, of the charity the British Heart Foundation, also said that they would support VAT cuts if they served to encourage industry and consumer to think healthy, and hoped to see a similar Europe-wide campaign "Government needs to take every possible action to keep the price of healthy foods and drinks low so that it's easier for people to maintain a healthy diet,"​ he stated. "A simple step we want applied immediately is that VAT on no-added-sugar fruit juices and smoothies is cut to the 5 per cent minimum."

Related topics: Markets, Juice Drinks

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