More sweet treats to be hit by 75% sugar tax
A bigger selection of sweet treats will be taxed at 75 per cent when the Government launches the next phase of its assault on sugar.
The rate of duty on items already affected is 50 per cent, with the additional 25 per cent due to be implemented from April 1.
Curtis Dickinson, the finance minister, said in his Budget that more goods would be included.
He told MPs: “In line with the Ministry of Health’s consultation paper, and as announced by the Minister of Health in the House of Assembly in March 2018, it is proposed to increase the rate of duty on a limited group of items from 50 per cent to 75 per cent.
“In a further phase of the implementation of the sugar tax, it is also proposed to extend the scope of items to be captured by the uprated 75 per cent sugar tax.
“These adjustments will yield an additional $4 to $5 million of customs duty.”
Kim Wilson, the health minister, brought modified legislation to Parliament last June after a backlash from businesses over a 75 per cent duty was proposed.
She told the House then that similar legislation elsewhere had been shown to reduce the consumption of sugar-laden beverages and other products that cause major health issues like diabetes and obesity.
However, businesses feared the tax would hit their profits and encourage shoppers to buy less healthy alternatives than home-made baked goods.
The revised Bill meant the rate was set at 50 per cent from October 1, 2018, and targeted sugary drinks and sweets, including powdered drinks, but let diet sodas off the hook.
It also provided local businesses such as bakeries a break from the top tariff.
However, Raymond Packwood, of Crow Lane Bakery, said yesterday he had applied for the concessionary rates but had no response.
He told The Royal Gazette: “They were supposed to have some sort of exemption for business owners, I think, for local manufacturers, which you can apply for, which we did but we haven’t heard anything yet.
“It would be a discount, a lower rate.”
Mr Packwood said he was not surprised the rate would increase to 75 per cent.
He added: “I never thought it was right, I had a problem with them doing raw sugar to start with. I didn’t think it was an item they should be targeting, but that said, they’re doing what they said they were going to do, so the business owners and the customers will just have to deal with it.”
Mr Packwood said: “I think if they’re going to target raw sugar for everybody then they should have increased duties on imported baked goods, whether it be cookies or even ice cream.
“What happened was the local producer was put at a disadvantage by changing the duty on sugar and leaving the imported products alone.
“If you’re going to do it, make it even across the board.”
No further details were provided in the Budget about what will be included in the extended scope of items.
Ms Wilson indicated last year the Government would continue to consider whether imported baked goods could be subjected to the sugar tax “in future phases”.
Mr Dickinson also said yesterday that duty on cigarettes, tobacco, beer, wine and spirits would increase in April to pull in additional customs revenues of between $1.5 to $2.5 million.