Milk-Based Drinks to Face Sugar Tax Under New Government Plans

Source: Department of Health and Social Care, 25 November 2025

Health Secretary Wes Streeting has confirmed that packaged milk drinks—including some ready-to-drink coffees—will soon be subject to the UK’s sugar tax. The move marks a significant expansion of the levy, which has applied to fizzy drinks since 2018 but previously exempted milk-based beverages.

Under the new rules, the sugar content threshold for the tax will also be lowered from 5g to 4.5g per 100ml, meaning more products will fall within its scope. The changes are scheduled to take effect on 1 January 2028, giving manufacturers time to reformulate recipes and reduce sugar levels.

Streeting’s announcement comes just a day before Chancellor Rachel Reeves delivers her budget. Reeves has signalled that both tax rises and spending cuts are on the table, though government sources confirm income tax rates will remain unchanged.

The policy aims to tackle rising sugar consumption and associated health risks, but it could mean higher prices for some popular milk-based drinks—unless producers cut sugar content to avoid the levy.