How Much Sugar Is in Your Oat Milk? UK Set to Tax Plant-Based Drinks

The UK government is planning to remove the exemption for sweetened dairy and plant-based milk from its sugar tax – what does this mean for non-dairy alternatives?

Sweetened oat and almond milk could now carry the same levy as Pepsi and Coke in the UK, according to a new government proposal.

The Treasury confirmed proposals to extend the soft drinks industry levy (SDIL) to dairy-based drinks like milkshakes, and non-dairy alternatives with added sugar, in a move first hinted at by Chancellor Rachel Reeves in the autumn budget last year.

The recommendations have been put out for consultation, and include plans to lower the threshold at which drinks become subject to the levy from 5g to 4g of added sugar per 100ml.

Why is the UK adding non-dairy milk to its soft drinks levy?

The SDIL was first introduced by the Conservatives in 2018 to tackle rising obesity in the UK, and has raised nearly £2B for the government. For the 2023-24, the tax revenue reached £338M, with most of this paid at the higher rate (for drinks with over 8g of sugar per 100ml).

It caused widespread reformulation within the soft drinks industry, leading to a 46% average reduction in sugar. Today, 89% of fizzy drinks sold in the UK are not subject to the SDIL, with most falling just below the 5g threshold.

Until now, milk-based drinks and dairy-free milks (with at least 120mg of calcium per 100ml) have been exempted from the tax due to concerns about calcium intake, especially among the youth. However, the government said that young people only get 3.5% of their calcium from milk-based drinks, so “it is also likely that the health benefits do not justify the harms from excess sugar”.

“By bringing milk-based drinks and milk substitute drinks into the SDIL, the government would introduce a tax incentive for manufacturers of these drinks to build on existing progress and further reduce sugar in their recipes,” the Treasury noted.

The move is geared towards improving the overall health of people in the UK, where obesity has doubled in the last 30 years (affecting 29% of the population). As of 2022, 37% of children aged 10-11 were overweight or living with obesity. The combined economic costs of adult obesity and associated lower productivity amount to £35B, which is around a third of the UK’s education spending. Meanwhile, British children consume more than twice the recommended amount of added sugar.

The government suggests that by lowering consumption of high-sugar drinks, the proposed changes to the SDIL could lead to positive health and economic outcomes, with calorie reduction equivalent to health and economic benefits of around £4.2B over the next 25 years.

How will plant-based milk be affected by the sugar tax?

The current exemption included products like chocolate-flavoured soy milk too, as long as it contained 120mg of calcium per 100ml. This offered “parity with the current treatment of milk-based drinks”, the Treasury explained.

It adds that removing the exemption on plant-based milk will actually “have a negligible effect” on how it’s taxed, since this affects a “very small minority” of products. Only a handful of non-dairy milks on the market have sugars above 4g per 100ml.

For example, Alpro’s Original soy milk contains 2.5g of sugar per 100ml, while its No Sugars range contains none. Even most barista milks fall under the 4g threshold, such as Sproud’s pea milk (1.8g of sugar per 100ml) or Califia Farms’ almond milk (2.7g).

There is an important caveat with milk alternatives made from grain like oats and rice. These products contain natural sugars released during the manufacturing process, similar to how the human body converts starch to sugar during digestion. This, however, is not added sugar, but forms part of the total sugar content found on the nutrition label.

The UK government clarified that the “sugars derived from the principal or ‘core’ ingredient” will be excluded from the definition of added sugar in these plant-based milks. Take Oatly, for instance. Its core lineup contains 3.4g of sugar, all from the oats themselves.

Another good example is Rude Health’s range, which relies on rice milk as a base for most of its drinks – its almond milk has 4.7g of sugars, though none of this is added sugar.

Flavoured plant-based milk in the spotlight

Under the UK dietary guidelines, unsweetened, calcium-fortified plant milks count as part of the ‘milk and dairy’ group in the Eatwell Guide, and can also be given to children aged one and above “as part of a healthy balanced diet”.

The only products in this category affected by the exemption are the sweetened flavoured non-dairy milks. Alpro’s vanilla soy milk contains 6.8g of sugar, meaning it would be subject to the new SDIL rules (should they be finalised).

That product currently retails for £2.10; once the levy is applied, this would rise to £2.28. Some critics have raised concerns about the impact of the SDIL on families, especially as the cost of living continues to remain significantly high. As health-conscious consumers look away from sugary foods and beverages, it could serve as a further incentive for them to switch to low- and no-sugar alternatives.

For brands like Alpro, it would likely necessitate a reformulation to bring the added sugar content in flavoured milks under 4g per 100ml. Others, whose products are already under the threshold, stand to win, such as Sproud’s vanilla pea milk, which only contains 3g of sugar and Califia Farms’s unsweetened vanilla almond milk, which has zero added sugar.

Danone’s Nutri-Score U-turn

The discourse around the sugar content in plant-based milks and comparing them with soft drinks got heated last year, after the classification system of the Nutri-Score label, which uses a five-colour, A-to-E rating to denote a product’s health credentials, moved non-dairy products from the ‘general foods’ category to the ‘beverage’ category.

It meant that only water got an A rating on the nutrition label in the beverage category, with some dairy and plant-based alternatives now being viewed in the same vein as soft drinks. The move led Danone, Alpro’s parent company and a former advocate of mandatory Nutri-Score labelling, to remove the label from its products.

“We have always supported consistent science-based, interpretive nutrition labelling and were pioneers in displaying, on a voluntary basis, the Nutri-Score on our packaging in Europe,” a Danone spokesperson told Green Queen last year.

“However, we do not agree with the revision of the algorithm, which switches drinkable dairy and plant-based alternatives into the beverage category,” they added. “This development gives an erroneous view of the nutritional and functional quality of drinkable dairy and plant-based products, not in line with food-based dietary guidelines in Europe.”

The company’s decision was met with backlash from nutritionists and consumer groups. “Danone’s U-turn on the Nutri-Score ignores consumers’ desire for clear nutritional information on packaging,” said Suzy Sumner, the Brussels head of consumer organisation Foodwatch. “It is unacceptable that Danone should decide to backtrack on the Nutri-Score because the products of some of its brands would score less well.”

Now that the UK government is targeting sugary plant-based milk, companies like Danone may have their hands forced. If they can revise product recipes to lower the sugar thresholds, it would result in a win for public health, consumers’ wallets, and businesses’ own bottom lines.