We currently see two main policy options that the Government could choose:

Option 1 - A broad food industry levy on salt and sugar  

This approach was recommended by the National Food Strategy and would be applied to all sugar and salt sold for use in processed foods or in restaurants and catering. It would therefore impact all processed food categories in which sugar or salt is used as an ingredient. 

Under this model, imports of processed food would also be taxed when they enter the UK on the basis of their sugar and salt content in order to prevent manufacturers off-shoring their operations to avoid the tax. The levy would include a carve-out applied to sugar and salt that goes straight to retail to avoid taxing ingredients that are used in home cooking. The levy would be paid by the manufacturers and importers of processed foods. The National Food Strategy proposed it be applied at a rate of £3/kg on sugar (and other ingredients used for sweetening) and £6/kg on salt.   

Option 2 - A targeted levy on specific, less nutritious product categories 

The levy would target categories that contribute significantly to excess sugar or to high fat, sugar and salt (HFSS) consumption and which are ‘discretionary’ i.e. non-essential elements of a healthy diet, to avoid it being applied to staple foods. Key categories to focus on are likely to include confectionery, cakes, desserts and biscuits, all of which contribute heavily to added sugar consumption.   

A similar approach could be taken for savoury snacks or other processed foods containing high levels of salt. The product categories used by Government for restricting advertising and promotions, along with evidence from voluntary reformulation programmes, would provide a guide for defining which products would come into scope.

Both options are likely to deliver substantial public health and economic benefits. And though their primary goal would be to encourage businesses to produce healthier products, both would also have significant potential for raising revenues if businesses chose to continue selling less healthy food and drink rather than changing the recipes of their products. Investing these revenues wisely in measures that support children's health and access to good food would strengthen the impact of the measures.