Does a spoonful of sugar levy help the calories go down? An analysis of the UK soft drinks industry levy

Dickson, Alexander and Gehrsitz, Markus and Kemp, Jonathan David (2023) Does a spoonful of sugar levy help the calories go down? An analysis of the UK soft drinks industry levy. Review of Economics and Statistics. pp. 1-29. ISSN 1530-9142 (https://doi.org/10.1162/rest_a_01345)

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Abstract

This study evaluates the effects of the 2018 UK Soft Drinks Industry Levy. We combine novel electronic point of sale data with longitudinal nutritional information and a variety of event-study specifications. All but a few global soft drinks brands reduced sugar content and hence avoided the tiered levy. For brands that maintained their recipes, the levy was on average over-shifted resulting in substantial retail price increases and reductions in consumption, particularly for colas. The levy is responsible for a reduction in intake of about 6,600 calories per year per UK resident, 80% of which is attributable to reformulation by manufacturers.

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