Strengthening the Soft Drinks
Industry Levy — Summary of responses
Detail of outcome
The consultation response document includes a summary of feedback
received on the proposed changes to the Soft Drinks Industry Levy
(SDIL) and
confirms the outcome of the consultation:
- the government will reduce the current lower threshold at
which SDIL applies from 5g of
total sugars per 100ml to 4.5g of total sugars per 100ml
- the government will remove the current exemption for
milk-based drinks with added sugar. A ‘lactose allowance'
will be introduced to account for naturally occurring sugars in
milk
- the government will remove the exemption for milk substitute
drinks with added sugar. Milk substitute drinks without added
sugar will remain outside the scope of SDIL. This includes
plant-based drinks that only contain sugars derived from their
principal or ‘core' ingredient
A technical consultation on the draft legislation will be
published in 2026 and changes to legislation introduced in a
subsequent Finance Bill, ahead of the legislation taking effect
on 1 January 2028.
Original consultation
Summary
HMRC and HM Treasury are seeking views on proposed changes to the
Soft Drinks Industry Levy (SDIL).
This consultation ran from
9:30am on 28 April 2025 to 11:59pm on 21 July
2025
Consultation description
Following the recent SDIL review, this
consultation sets out proposals to build on the SDIL's success in
incentivising soft drinks producers to reduce sugar content.
These proposals are:
- to reduce the minimum sugar content at which
the SDIL applies
to qualifying drinks from 5g to 4g. The SDIL standard rate would
apply from 4g to 7.9g total sugar per 100ml, as opposed to 5g
to 7.9g total sugar per 100ml currently
- to remove the exemption for milk-based drinks whilst
introducing a ‘lactose allowance' to account for the natural
sugars in the milk component of these drinks
- to remove the exemption for milk substitute drinks with
‘added sugars' beyond those sugars derived from the principal
ingredient, such as oats or rice
The government welcomes your views on these proposals as part of
this consultation and your feedback will inform decisions by HM
Treasury ministers.
Documents
Strengthening the Soft Drinks
Industry Levy consultation
