Sugar tax adds 60c to two-litre bottle of fizzy drink
The tax on fizzy drinks will push up the cost of a two-litre bottle of Coca Cola from €2.40 to €3.
Soft drinks including Red Bull, Fanta and Pepsi, which all have substantial sugar content, are all in line for a price increase.
The sugar tax, announced in the Budget, is aimed at reducing our consumption of high calorie drinks which are fuelling our rates of obesity.
The tiered tax, which comes into effect in April and is expected to raise €40m in a full year, will apply at 30c a litre for drinks with over 8g of sugar per 100ml.
There will be a 20c per litre tax for drinks with sugar content of between 5g and 8g per 100ml.
Diet drinks are free from tax.
Health Minister Simon Harris said yesterday he wants to see more drinks companies reformulating their products to make them low or zero sugar, a move which is already under way.
Colm Jordan, director of the Irish Beverage Council in Ibec, said: "We've been offering low-sugar drinks for 30 years. We will continue to reduce sugar content and increase our no-sugar/low-sugar offering to reflect consumer taste and choice.
"Obesity is a complex societal issue. Where similar taxes were introduced, obesity rates increased.
"The Department of Health's own assessment found no conclusive evidence a tax will impact population weight."
However, Dr Donal O' Shea, who is now leading the Government's obesity strategy, insisted this measure could reduce obesity rates within five years, with thousands of cases per year.
"We will have to monitor the impact to ensure maximum effect. I am relieved and delighted to see the sugar tax get over the line.
"The Government only has blunt instruments to influence behavioural change - but it simply must use them in the battle against obesity."
The UK will introduce the tax at the same time but there are fears drinks companies will reduce the price of sugary drinks and increase the cost of the diet versions.
However, Dr O' Shea said he saw the tax as a way of encouraging producers to reduce sugar content in drinks, to market alternatives lower in sugar and to reduce portion sizes for high sugar drinks.
He admitted, however, that it must be part of a suite of measures to address obesity.
A spokesman for Britvic Ireland said it recognises the Government's decision to implement a sugar tax but is disappointed the soft drinks sector has been" arbitrarily singled out."
Nearly 75pc of Britvic Ireland products are already low- or no-sugar, and not subject to the tax, according to the company.
Kevin Donnelly, the company's managing director, said: "It is essential the Department of Finance and Revenue engage with the industry to ensure that Republic of Ireland manufacturers, retailers, wholesalers, publicans and food service operators are not disadvantaged versus imported product, especially in an environment of weakening sterling.
"Given the implementation timeline is less than half that afforded to the industry in the UK, early engagement on this matter is crucial."