Germany to tax sugary drinks to fund healthcare
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The German government will impose a tax on sweetened beverages starting July 1, 2027. Drinks containing five or more grams of sugar per 100 millilitres will be taxed 26 cents, while those with eight or more grams will be taxed 32 cents.
The tax aims to encourage healthier eating habits and generate revenue for the healthcare system. Smaller producers making less than one million litres of sugary drinks annually will be exempt, pending approval from the European Commission.
The initial plan faced internal opposition, with some arguing it deviated from a financial commission's proposal and lacked sufficient support. The final version removed a higher tax bracket for drinks with more than 10 grams of sugar and excluded juices, milk-based drinks, alcoholic beverages, and drinks using alternative sweeteners. The tax will apply to sodas, sweetened iced tea, energy drinks, and other sugary drinks.
Finance Minister Lars Klingbeil intends for the tax to both increase government revenue and motivate manufacturers to reduce sugar content in their products. The government projects the tax will generate approximately 690 million euros in 2027, rising to 925 million euros in 2028, and around 890 million euros annually through 2031. These funds will offset planned cuts to federal healthcare funding, ensuring stable contributions to mandatory health insurance.
The tax will only cover beverages, not sugary foods like chocolate or cookies, though cereal manufacturers have already voluntarily reduced sugar content in their products by around 44% since 2016. Despite reaching an agreement, some politicians criticized the tax, fearing it would raise prices and harm the beverage industry.
