Louise O'Reilly (Dublin Fingal, Sinn Fein)
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216. To ask the Minister for Finance the revenue that would be gained through the introduction of a sugary drinks tax; and if he will make a statement on the matter. [10362/16]

Michael Noonan (Limerick City, Fine Gael)
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The introduction of a health levy on sugar-sweetened drinks has been included in the Programme for a Partnership Government. This levy will be one of a number of key public health interventions that this Government will make, as well as serving to provide additional revenue to the Exchequer.

While the details of the proposed levy, including structure, rate and application, have not been finalised, it is worth noting that similar proposals have been examined by my Department in the context of the 2015 and 2016 Budget process. They were initially considered through the Tax Strategy Group (TSG) General Excise Paper in September 2014 and again in September 2015. The 2014 and 2015 Tax Strategy Group papers are available on my Department's website.

These papers highlighted a number of challenges that need to be overcome when introducing such a tax. These included the potential impact on retailers and domestic soft drinks producers, the difficulties in applying an excise on a product which is not defined as a product under the EU general excise directive, the challenge in differentiating between sugar sweetened and artificially sweetened products and the challenge of collecting an excise on a product which has free movement between Member States and is not subject to the controls of a bonded warehouse like other excisable products such as alcohol, tobacco and mineral oils.

The tax strategy group paper for 2015 described a potential structure for a tax on sugar-sweetened drinks (SSD), which applied the tax to all drinks encompassed by CN code 2202 (includes soft drinks with added sugar and 'diet' products which contain artificial sweeteners). The outlined effects of various rates of SSD tax per hectolitre on CN Code 2202, the associated VAT-inclusive increase in the price of a 330ml can of soda, and associated VAT-inclusive yield on a no-change basis are provided in the table following.