A drop of Pepsi should drop in price within weeks as N.L. removes sugar tax through cabinet regulations

Two-litre bottles of Pepsi and other sugar-sweetened beverages for sale in Newfoundland and Labrador will become cheaper for consumers within weeks, according to Finance Minister Siobhan Coady.

Premier John Hogan announced on May 12 the province would axe its controversial sugar tax, implemented by former Premier Andrew Furey in 2022 as an incentive to encourage consumers to make healthier beverage choices.

Hogan repealed the tax in response to public concerns about affordability, but legislation has yet to come forward in the House of Assembly to have the tax officially eliminated. On Thursday, the legislature concluded its spring session a week early. 

In the meantime, Coady says the province would remove the tax through regulations by Hogan's cabinet instead of legislation, similar to the federal government's removal of the carbon tax. 

"We're talking to the retailers and wholesalers to make sure we do this properly and correctly," she said. "We're making sure there's no inventory in the process."

PC Leader Tony Wakeham is disappointed the legislation to remove the tax wasn't put forward in the House of Assembly this spring.

While the province says the tax will be removed, Wakeham says it won't be eliminated until legislative change takes place in the House.

"They're going to do it through regulations, not through the legislature, so it allows the cabinet to actually go back, bring it down to zero and bring it back up again if they so choose," he said, adding that if the House wasn't closing early they would have had time to eliminate the tax entirely.

"Bringing in the legislation and eliminating the sugar tax can be done next week," Wakeham said. "Let's bring in the legislation and get it done."

The provincial government has taken in more than $35.5 million through the sugar-sweetened beverage tax since its inception in 2022. 

Coady believes the tax served its purpose to push consumers to pick healthier non-taxed options like diet drinks, some juices and water. 

"The older demographic continues to drink sugar-sweetened beverages, but the younger demographic certainly has gotten the message," Coady said.

She says programs funded by the tax, such as school lunches and supplies for diabetics, will be funded through tightening budgets within some government departments. 

Download our free CBC News app to sign up for push alerts for CBC Newfoundland and Labrador. Click here to visit our landing page.