A study by Newcastle University shows a 20 % sugar tax could discourage shoppers from buying unhealthy breakfast cereals.
Researchers found demand for sugary cereals fell by 48 per cent if consumers knew a tax was being applied.
The study, carried out by experts from Newcastle, York and Anglia Ruskin Universities, examined the impact of both a 20% and 40% tax on unhealthier cereals and soft drinks containing sugar. It also looked at whether telling people they were being taxed influenced the way they shopped.
People taking part in the study and were given a budget of £10 to spend on soft drinks and cereals. The products were classed by researchers as healthier or less healthy, depending upon their nutritional value.
Lead researcher, Daniel Zizzo, Professor of Economics at Newcastle University Business School, said: