The Irish Beverage Council has called on the Government not to introduce a sugar tax in the upcoming budget, claiming it would cause economic damage to both business and consumers in the country.

In a report prepared for the Minister for Finance, the IBC says that “despite being introduced in a number of countries, sugar taxes have never achieved public health objectives of reducing the consumption of sugar or decreasing levels of obesity, overweight and related diseases”. 

The report also states such a levy would increase grocery shopping bills, encourage cross-border trade and smuggling and increase business costs.

According to the report by the Ibec group, a 10c sugar tax on a can of soft drink would result in the average Irish household’s annual grocery bill increasing by €60, soft drinks companies here losing around €60m in annual sales, and the Exchequer also taking an annual hit of €35m.

IBC Director Kevin McPartlan said: “Industry has a crucial role to play in tackling the serious obesity problem in Ireland.

“However, it is vital that the focus is on interventions that make a genuine and sustained positive impact. A sugar tax may be populist, but it is simply not supported by evidence.

“International experience proves beyond any doubt that sugar tax is singularly ineffective.” 

However, Sinn Féin Health Spokesperson Louise O'Reilly has described a sugar tax as a necessary preventative measure.

Ms O'Reilly said: "Obesity was estimated to have cost the State €1.13 billion in 2009.

"The most recent WHO reports predict that Ireland is heading for a massive increase in rates of obesity and excess weight.

"The Government must act now to ensure that these predictions do not become reality. The sugar tax is a first step in this."