Does a Spoonful of Sugar Levy Help the Calories Go Down? An Analysis of the UK Soft Drinks Industry Levy

This study evaluates the effects of 2018 UK Soft Drinks Industry Levy on soft drinks prices, sales, reformulation activities, and consequently calories consumed. We combine novel electronic point sale data that cover most market with longitudinal nutritional information a variety event-study specifications. document all but few global brands reduced sugar content hence avoided tiered levy. For maintained their original content, levy was average over-shifted resulting in substantial retail price increases. Consumers responded by reducing consumption levied around 18% which is indicative an inelastic demand response, especially drink-now energy drink segments market. also substitution into diet response to tax. In total, responsible for reduction intake just under 6,500 from per annum resident. More than 80% reductions were due manufacturers’ activities occurred two years between announcement its implementation.