Highly sweetened café drinks will remain free from the 'sugar tax'
Coffee shop and dairy drinks, some of which can have as many as 25 spoons of sugar, are to escape the Government's planned sugar tax.
The tax, which will come into effect in April 2018, will be imposed only on fizzy drinks with more than 5g of sugar per 100ml.
The Department of Finance, which estimates it could raise as much as €202m from the anti-obesity measure, said it will be based on the volume of sugar in the soft drink.
It applies only to pre-packaged products in bottles and cans - but it will exclude dairy-based sugar-sweetened drinks or sweetened café coffees.
However, some of the these café chain drinks, such as the Starbucks Hot Mulled Fruit-Grape with Chai, can have as much as 25 teaspoons of sugar. That is more than three times the recommended maximum adult daily intake of sugar.
All the major café chains have said they aim to reduce the sugar content in their drinks by 2020.
If the eventual tax here is imposed at the highest rate, it could see a two-litre bottle of fizzy drinks, currently costing an estimated €2, levied with an extra tax of around €1.20.
But many remain sceptical that the measure will curb the nation's sweet tooth, although campaigners insist that the tax will at least raise awareness about the risks of consuming too much sugar.
The Department of Finance consultation document on the tax, which is inviting submissions until January, also pointed out that the UK will bringing in the same levy in April 2018.
It said this removes concerns here that an Irish tax would encourage cross-border shopping in Northern Ireland.
The taxes need to be set at similar levels .
Sugar-sweetened foods are excluded.
It said that to minimise the compliance burden on taxpayers and ensure administrative efficiency, liability to pay the tax will fall at the earliest point of the distribution chain.
It means that the tax will be limited to a number of traders who are manufacturers and importers of sugar-sweetened drinks.
The hope is that it will force the makers of soft drinks to invest in reformulation to reduce sugar content.
But this process is expensive, and the tax will cost companies, the beverage industry warns.