Government warned Sugar Tax could hit low income families hardest, documents reveal

By | 21st June 2018

FINANCE minister Paschal Donohoe was warned that revenue from the introduction of a sugar tax would be unreliable and that the impact of its introduction would hit low income families hardest.

He was also told the tax could potentially be “subject to litigation” if it failed EU state aid rules and could cause administrative problems for Revenue in collecting it.

The new levy was subsequently approved by the EU Commission last month who said it did not involve state aid; it was then formally introduced on May 1.

Minister Donohoe was firmly behind plans for the tax, saying the only thing that stood in its way was if the same type of levy was not introduced in Britain and Northern Ireland.

In a note to civil servants, he said: “Yes we will do this … at a rate similar to the UK. Only thing that will stop this is it not happening in UK/NI. Please move ahead with it.”

His comments are contained in a ministerial submission on the sugar tax prepared ahead of Budget 2018. It has only been released now however following an FOI request.

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