Coca-Cola South Africa has cut the sugar in its drinks by 26% since the government introduced a tax on sugary drinks in April 2018. The move almost halves the amount of additional tax added to a 500ml bottle of Coca-Cola as a result of the new sugar tax.

Coca-Cola denies the cut in sugar content of its drinks in South Africa is related to the new tax, positioning the formulation change in the context of “a global strategy driven by customers’ needs and preferences to provide greater choice”. In a refreshingly frank statement, the head of communications for Coca-Cola Southern and East Africa said that “We recognise that too much sugar isn’t good for anyone and support the current recommendation […] that people should limit their intake of added sugar to no more than 10% of their total energy/calorie consumption.”

The implementation of the new sugar tax in April 2018 means that the first 4g of sugar per 100ml are not taxed. After that, the South African government charges a levy of 2.1 cents per gram of sugar content. To put this in context, on its pre-tax formulation 100ml of Coca-Cola contained 10.6g of sugar per 100ml. A 500ml bottle of Coca-Cola costing R10 ($0.80) attracted a levy of R0.70 ($0.06), i.e. effectively a 7% price increase if passed on to the consumer. The reformulation means that a 500ml bottle attracts a levy of R0.40 now ($0.03), a 4% increase.

Coca-Cola has also launched new no sugar and low calorie soft drinks to beat the sugar tax, using in-store marketing and ‘preferable pricing’ to drive uptake. Coca-Cola South Africa has said that, along with a challenging economic environment and depressed consumer spending, the sugar tax will lead to the loss of more than 1,000 employees. The company has reported lower volumes that it forecasts will only recover in 2021.