The Minister for Finance and Public Expenditure and Reform, Paschal Donohoe TD, Minister for Health, Simon Harris TD and Minister of State for Health Promotion Catherine Byrne TD today (Tuesday) welcomed the finding of the European Commission that the upcoming sugar-sweetened drinks tax does not constitute State aid.
This allows for the commencement of the Sugar-Sweetened Drinks Tax on 1st May 2018.
The tax on Sugar-Sweetened Drinks was announced as part of Budget 2017 with the launch of a public consultation which ran from Budget night until January 2017. Following on from that process, a series of technical consultations took place with officials from the Department of Finance and the Revenue Commissioners, together with representatives from the soft drinks industry. This positive engagement with industry continued throughout the process. Budget 2018 provided for the final details of the tax including the rates and thresholds.
The legislation governing the tax was delivered through the Finance Act 2017. For reasons of clarity, a legislative amendment will be made in this year’s Finance Act to impose a calcium threshold on products in three exempted subheadings under the EU classification system to ensure exempted products are comparable to dairy.
Ireland has engaged in extensive and constructive discussions with, and submitted a formal notification to, the European Commission to ensure that once commenced, the Sugar Sweetened Drinks Tax does not infringe EU State aid law. With today’s announcement that process is complete and the tax can commence on 1 May 2018.
Commenting on the sugar-sweetened drinks tax, the Minister Donohoe said:
Welcoming the introduction of the tax, Minister Harris said:
“This is significant and positive news and represents major progress under Healthy Ireland towards tackling obesity. With one in four children on the island of Ireland either overweight or obese, this tax is one of a range of measures that can help change parents’ and children’s behaviour. There is no nutritional value in these sugar-sweetened drinks and it has been proven that the intake of these beverages, particularly in children, leads to weight gain and tooth decay.
Minister of State for Health Promotion, Catherine Byrne TD said:
Notes to the Editor:
The tax is estimated to yield in the region of €40m in a full year, however, it is expected that as industry reformulates and consumers opt for healthier options this figure will reduce over time.
The tax will be levied at the first point of supply in the State and taxpayers are required to register with the Revenue Commissioners. A Sugar Sweetened Drinks Tax – General Taxpayer Guide, which provides detail around the operation of the tax, is available on the Revenue website here .