George Osborne’s sugar tax on soft drinks set to put 4,000 British jobs at risk
GEORGE Osborne’s sugar tax on fizzy drinks will wipe out 4,000 jobs and cost the economy £130million, experts have warned.
Respected forecasting body Oxford Economics found the hated plan to slap a 48p levy on two-litre bottles of pop will have a devastating impact as drinks firms, suppliers, shops, bars and restaurants deal with the effects.
Its modelling predicts 1,775 jobs will go from the on-trade, while 746 will be axed by supermarkets, 500 in smaller shops, 637 in the supply chain and 373 elsewhere.
But the move will cut just five calories a day from diets – equivalent to one bite of an apple or spoonful of soup.
The jobs will be lost as higher prices cause sales to fall and people to switch products, hitting certain manufacturers and suppliers.
Nick Stewart, Senior Economist at Oxford Economics, said: “These are significant losses.”
The damning findings sparked calls for new PM Theresa May to axe the tax, which was a pet project of the former Chancellor intended to curb childhood obesity.
Mr Osborne announced it in his final Budget under pressure from campaigners like celebrity chef Jamie Oliver.
Gavin Partington, Director General of the British Soft Drinks Association, said: “In the face of great economic uncertainty this is no time for a measure that will result in job losses and higher prices for those who can least afford it.
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“We urge the Government to think again and support UK businesses and consumers.”
Tory MP Will Quince said he would write to Mrs May and new Chancellor Philip Hammond urging them to ditch the tax.
He said: “It’s time for a re-think. This is the worst time possible to be hitting one of the country’s leading manufacturing sectors.”
Campaigners say the move is needed to curb Britain’s devastating child obesity epidemic.
But critics say similar moves have failed in other countries.
And manufacturers say they are already cutting calories from diets.
Mr Partington added: “There is no evidence worldwide that food taxes have an impact on levels of obesity.
“By contrast Industry efforts to help consumers cut sugar intake are working, with calories from soft drinks now down 16 per cent since 2012.”
The Treasury said drinks firms would have two years to cut sugar content below accepted levels to avoid the tax, and said it was needed to cut the £5.1 billion-a-year cost of obesity on the NHS.
A spokesman said: “The soft drinks industry levy is a major step forward in our efforts to tackle childhood obesity.
“Health experts agree there is a specific problem with sugar-laden fizzy drinks that must be addressed.”
Where the jobs will be lost
Trade (bars, pubs, restaurants): 1,775
Major retailers: 746
Small shops and convenience stores: 500
Delivery and distribution supply chain: 369
Manufacturing supply chain: 268
“Induced” jobs in other parts of the economy: 373
TOTAL: 4,031.