The UK government is considering a new tax on packaged milkshakes and lattes, often referred to as the “milkshake tax.” This proposal is part of Chancellor Rachel Reeves’s broader fiscal strategy, set to be announced in an upcoming Budget presentation.
Details of the Milkshake Tax Proposal
The proposed tax aims to extend the existing sugar tax, which primarily targets sugary fizzy drinks, to include milk-based beverages. This initiative is a response to the pressing need for increased government revenue without raising income tax, a move that could contradict Labour’s election promises.
Potential Impact on Prices
If implemented, the milkshake tax could slightly increase the price of various milk-based products:
- Packaged milkshakes
- Milk-based coffees
- Protein shakes
Manufacturers may react by reducing sugar content in their products to mitigate higher costs associated with the new tax.
Context and Timing
Chancellor Rachel Reeves will unveil her fiscal plans in the House of Commons shortly. The announcement of the milkshake tax might surface earlier, potentially from Health Secretary Wes Streeting.
This situation reveals the government’s urgent need to balance revenue generation with public commitments made during the last election. As details continue to unfold, stakeholders await definitive actions regarding new taxation measures.
