In a significant move to tackle the UK's obesity crisis, Health Secretary Wes Streeting has announced that pre-packaged milkshakes, lattes, and other milk-based drinks will no longer be exempt from the sugar tax.
Closing the Milkshake Loophole
Addressing the House of Commons on Tuesday 25 November 2025, Mr Streeting confirmed the government will expand the Soft Drinks Industry Levy (SDIL) to include bottled and cartoned milkshakes, flavoured milk, and milk substitute drinks. The new rules will take effect from 1 January 2028, giving manufacturers time to reformulate their products.
"Obesity robs children of the best possible start in life, hits the poorest hardest, sets them up for a lifetime of health problems and costs the NHS billions," the Health Secretary told MPs. He emphasised that the government "will not look away as children get unhealthier."
Stricter Sugar Limits and Expected Impact
The government will also tighten sugar limits, reducing the maximum amount allowed in drinks to 4.5g of sugar per 100ml. This represents a slight relaxation from the 4g per 100ml threshold originally proposed in the government consultation.
According to Department of Health estimates, this expansion could remove 17 million calories from the nation's daily intake. The changes are projected to prevent nearly 1,000 cases of childhood obesity and almost 14,000 cases of adult obesity, while reducing pressure on the NHS by preventing cancer, heart disease and stroke.
The existing sugar tax, introduced in 2018, has already driven a 46% average reduction in sugar content in affected soft drinks between 2015 and 2020.
Mixed Reactions from Health and Industry Groups
Health campaigners have broadly welcomed the move. Katharine Jenner of the Obesity Health Alliance called it "a sensible and long-overdue step to protect children's health - especially their teeth."
However, Dr Kawther Hashem from Action on Salt and Sugar expressed disappointment that the government didn't implement the stricter 4g threshold, stating that nearly three-quarters of drinks already fall below 4g/100ml.
The Food and Drink Federation acknowledged the government had listened to industry concerns about the "costly and technically complex work" required for reformulation. Meanwhile, business experts warned about the impact on the struggling high street, with Nick Garside of Menzies LLP describing it as "another blow to businesses already drowning in complex taxes."
Notably, the levy will only apply to pre-packaged drinks sold in supermarkets, excluding beverages made fresh in cafes and restaurants. Plain, unsweetened milk and milk alternatives will also remain exempt from the tax.
