The government admitted today it has not yet worked out how small companies would be protected from the impact of the soft drinks levy, as it asked the industry for advice on what the cut-off should be.
In his March Budget former chancellor George Osborne announced that small operators would be exempt from the tax, which is due to come into force in April 2018.
However, in a consultation released by the Treasury today, it said it was still looking at how much production volume or imports companies would have to have to escape the net.
The Treasury said it had not yet decided whether to exclude small companies altogether based on a cut-off for their activity or to provide relief on a set amount of liable products.
The consultation says: “The limit for exclusion or relief has not yet been set and we wish to use this consultation to determine an appropriate level.”
It added: “We would still expect small soft drinks producers to work towards reducing the sugar content of their added-sugar products, particularly if as their business production grows, they may become liable to the levy over time.”
An industry campaign against the levy has claimed that small businesses will be hit hardest by the tax, rather than the big drinks firms, with a report by Oxford Economic forecasting 4,000 job losses in the UK.
Today’s consultation, which at 45 pages is nearly three times longer than the childhood obesity plan, also seeks industry views on the intended exceptions to the levy, including milk-based drinks and fruit juice drinks without added sugars.
The government says it plans to exclude milk drinks only if they contain more than 75% milk, with those not meeting the criteria set to be hit.
Others escaping the net include candy sprays, ice lollies and dissolvable powders, although the Treasury said it would be keeping these areas “under review”.
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