Extract A: The retail prices of high-caffeine energy drinks, selected outlets in Birmingham, November 2023

Note: Supermarket and online wholesaler prices are often lower due to bulk purchasing and lower operating margins per unit.

Extract B: Addressing the rise of youth caffeine consumption

Alongside traditional soft drinks, high-caffeine energy drinks are increasingly categorised by public health economists as demerit goods due to concerns over cardiovascular risks, chronic sleep disruption, and anxiety among teenagers. The British Cardiovascular Health Association (BCHA), a prominent body of medical professionals, recently argued that a substantial portion of caffeine-related health issues in adolescents could be mitigated by introducing a statutory ban on sales to minors or imposing a strict excise duty on energy drinks. The BCHA recommends that any potential tax should scale directly with the caffeine concentration per 100ml of the beverage.

Furthermore, health advocates have supported calls to ban aggressive promotional pricing strategies, such as "buy-one-get-one-free" offers or "loss-leader" tactics where popular energy brands are sold below cost to attract younger, brand-loyal consumers. A representative from the BCHA Ethics Committee commented: "We are facing an emerging public health challenge. While raising prices via taxes may be unpopular with some consumers, the alternative is a generation facing chronic sleep deprivation and early cardiovascular complications. Governments have previously been too slow to regulate the marketing and accessibility of these highly addictive stimulants."

Currently, UK taxes on energy drinks are relatively low compared to alcohol or tobacco, with these beverages subject only to standard Value Added Tax (VAT) and the Soft Drinks Industry Levy (sugar tax) if sugar levels are high, but with no specific caffeine-based excise duty.

Extract C: Are high-caffeine drinks too accessible?

In a competitive market, is it appropriate for governments to intervene to prevent cheap high-caffeine products? While there are calls to end the sale of energy drinks to school-aged children, some economists argue that youth demand for these products is relatively price-inelastic due to habituation, intensive advertising, and peer influence. They caution that flat price increases might unfairly penalise adult working consumers who rely on energy drinks for alertness.

A policy shift focusing on age restriction rather than pricing may be more effective. While many large supermarket chains voluntarily apply a "no under-16s" policy, enforcement across the wider retail landscape is highly inconsistent. Smaller independent convenience stores, petrol station kiosks, and online wholesale platforms often have less rigorous age verification procedures. Some policy analysts suggest introducing a mandatory statutory ban on sales to under-16s to create a standardized legal framework.

A spokesperson for a major supermarket chain stated: "We cannot unilaterally raise our prices to deter young buyers because consumers would simply switch to independent corner shops or cheaper online alternatives. This would lead to a loss of market share, and any coordinated pricing agreement between major retailers is strictly illegal under competition law."