Sweet drinks to go sour: Milkshakes and lattes set for price hikes as government to extend 'sugar tax'

Wes Streeting is expected to tell the Commons on Tuesday that the Government will end the exemption for milk-based drinks from the existing tax on sugary drinks.

The move will affect packaged milkshakes and coffees, but not drinks made in cafes and restaurants.

Read More: What is sugar tax and how does it work?

It follows a Government consultation on the issue looking at removing the exemption for milk-based drinks while introducing a "lactose allowance" to account for the natural sugars in the milk component of the drinks.

Ministers have also been looking at removing the exemption for milk substitute drinks with "added sugars" beyond those sugars derived from the principal ingredient, such as oats or rice.

The sugar tax, also known as the soft drinks industry levy (SDIL), is a tax on pre-packaged drinks such as those sold in cans and cartons in supermarkets.

It applies to manufacturers and was introduced by the Conservative government in 2018 to help drive down obesity, including among children.

The Government has also been looking at reducing the maximum amount of sugar allowed in drinks from five grams to four grams per 100ml, after which point they will be hit by the levy.

According to the Treasury, children's sugar intake in the UK is more than double the recommended maximum of no more than 5% energy from free sugar.

The existing levy has led to a 46% average reduction in sugar between 2015 and 2020 for those soft drinks that were to be brought under the rules.

"Obesity is the major challenge of our health service for this generation, and it is important that we make sure that we create the healthiest young generation of children coming forward."