Coca-Cola denies sugar being cut from its drinks is linked to tax

Coca-Cola recently reported a 5% growth in global income for the first quarter of 2019, despite its claims that taxes on sugary drinks  would harm the company and cause job losses. Image: iStock

Coca-Cola recently reported a 5% growth in global income for the first quarter of 2019, despite its claims that taxes on sugary drinks would harm the company and cause job losses. Image: iStock

The Health Promotion Levy was introduced on 1 April 2018, and involves a tax of 2.1 cents per gram of sugar on all sweetened drinks.

According to the company, it has reduced the sugar content of its drinks by over a quarter since 2016 – which is when government announced it was considering a tax on sugary drinks.

However, Julie Cunningham from FTI Consulting, which does PR for Coca-Cola South Africa, said that “the reformulation process is a global strategy driven by customers’ needs and preferences to provide greater choice –  making low and no-sugar options accessible and available across a wide array of categories”.

In his Budget speech in February 2016, then Finance Minister Pravin Gordhan announced that Treasury intended to introduce a tax on sugar-sweetened beverages to “help reduce excessive sugar intake”.

“In South Africa, over a two-year period (2016-2018), we had reduced average sugar content across our portfolio by 26%, ahead of industry commitments of 15%,” said Camilla Osborne, Head of Communications for Coca-Cola Southern and East Africa.

The Health Promotion Levy was introduced on 1 April 2018, and involves a tax of 2.1 cents per gram of sugar on all sweetened drinks but the first 4g of sugar per 100ml is exempt from taxation. Treasury explained that this exemption was aimed to act as incentive for manufacturers to cut the sugar content to 4g or below per 100ml.

Over the past few years, a range of countries including Mexico, the United Kingdom, Ireland, Portugal, France, Saudi Arabia and the United Arab Emirates (UAE), as well some US states, have introduced a tax on sugary drinks.

“We recognise that too much sugar isn’t good for anyone and support the current recommendation by several leading health authorities, including the World Health Organisation (WHO), that people should limit their intake of added sugar to no more than 10% of their total energy/calorie consumption,” said Osborne.

“We have launched a range of no-sugar and low-kilojoules options and have shifted marketing investments, including in-store, to lead with our no- or low-sugar options. To aid portion control, we offer different pack sizes too. We are also offering preferable pricing for no-sugar products in South Africa.” – Health-e News.

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