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Natural flavours emerge as key sugar-cutting solution ahead of UK’s sugar tax
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Thursday, 04 December, 2025, 15 : 00 PM [IST]
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London, UK
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With the expansion of the sugar levy announced in the latest UK budget, the beverage industry is bracing for a paradigm shift. Under the new rules effective January 2028 not only soft drinks, but milk-based drinks, plant-based milks and ready-to-drink (RTD) coffees will come under the sugar tax.
In response, many food and beverage brands are turning to natural flavour systems to stay compliant while preserving taste and consumer appeal. Natural flavour technologies, such as the “SweetLITE” range from flavour house ITS, claim to enable brands to cut added sugar by up to 50% yet still retain sweetness, mouth-feel and overall flavour intensity.
For manufacturers, the pressure is not only regulatory but also consumer-driven people increasingly seek “clean-label” products with less sugar yet great taste. Natural flavour systems, including offerings by players like Treatt and Kerry, are being positioned as effective tools to meet this demand without compromising the sensory quality of beverages even in dairy-based or plant-based categories that the levy will now cover.
Still, not everyone is fully on board. The UK’s dairy trade body Dairy UK expressed reservations, noting the nutritional importance of milk- and yogurt-based drinks sources of calcium, protein, iodine, and other vital nutrients — particularly for children. However, Dairy UK acknowledged the inclusion of a lactose allowance in the levy proposal, meaning naturally occurring lactose would not be taxed — giving manufacturers time to reformulate while preserving the nutritional value of dairy drinks.
As the 2028 deadline approaches, the shift toward natural flavour-driven sugar reduction seems inevitable. For beverage makers, this signals not just compliance, but an opportunity to meet rising consumer demand for healthier, lower-sugar drinks without sacrificing taste or texture.
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