Why Low-Sugar Foods Are Taking Over Asia: The Impact of Sugar Tax Debates

Daniel Kim | 2026.04.11

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[Herald Economy = Jin Kim] As political debate over a proposed sugar levy heats up, food makers are racing to launch low-sugar options. With consumers more health-conscious than ever, sales of these products are on the rise.

On the 11th, industry sources reported that Ottogi rolled out two LIGHT&JOY low-sugar dressings that cut sugar by more than 90%. Paris Baguette’s health-focused bakery brand Parang Label introduced a low-sugar matcha cake. Lotte Chilsung Beverage launched Gatorade Run with less than 2.5 g of sugar per 100㎖ (about 3.4 fl oz). Seoul Milk Cooperative released a Greek yogurt sweetened with the sugar alternative allulose.

Industry insiders say the surge in low-sugar launches is closely tied to this year’s intensifying sugar-levy conversation. The debate began in January when President Lee Jae-myung proposed using revenue from a sugar tax to reinvest in local and public healthcare. Since then, lawmakers and academics have been offering concrete proposals.

At a symposium on the 7th hosted by the Korea Rural Economic Institute, the National Research Council for Economics and Humanities, and the Korea Institute of Public Finance, one proposal suggested a three-tier levy based on sugar content. Professor Park Eun-chul of Yonsei University proposed exempting drinks with under 5 g of sugar per 100㎖, charging 225 KRW per liter (approximately $0.17) for drinks with 5–8 g per 100㎖, and charging 300 KRW per liter (approximately $0.23) for drinks with 8 g or more per 100㎖.

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Professor Park’s plan is modeled on the U.K.’s Soft Drinks Industry Levy, introduced in 2018. The U.K. charges about 19.4 pence per liter for drinks with at least 5 g of sugar per 100㎖ and about 25.9 pence per liter for drinks with 8 g or more per 100㎖. Based on the U.K.’s first-year levy revenue (around 443.5 billion KRW, approximately $332.6 million), analysts estimate Korea’s sugar-levy revenue could be about 227.6 billion KRW (approximately $170.7 million).

The ruling Democratic Party has filed several bills to support the president’s idea. In February, Rep. Lee Su-jin (DP), a member of the National Assembly’s Health and Welfare Committee, introduced a revision to the National Health Promotion Act that would apply a nine-step tax based on sugar content per 100 liters — ranging from 1,000 KRW (approximately $0.75) up to 28,000 KRW (approximately $21.00) per 100 liters — with tiers starting at 1 kg per 100 liters and extending beyond 20 kg per 100 liters.

Rep. Heo Seong-mu (DP) proposed amending the Act on Labeling and Advertising of Foods to evaluate overall nutritional content, not just sugar. His bill would grade products based on nutrient profiles and display those grades clearly on packaging, modeled on France’s Nutri-Score system, first implemented in 2017.

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Buying habits are shifting. A March report from the Korea Agro-Fisheries & Food Trade Corporation (aT) found that purchases of natural sweeteners jumped 62% over the past year — the biggest increase among categories. Artificial and synthetic sweeteners (like aspartame and sucralose) rose 42.3%, other added sugars (such as xylitol) rose 34.0%, and raw or unrefined sugars rose 33.4%. By contrast, purchases of refined sugar and syrup fell by 24.4% and 20.5%, respectively. The report calls this “reduction trend” for sugar, fat, and sodium a core global movement in the food and beverage industry.

Retail trends mirror the change. Convenience-store chain GS25 said sales of so-called “Low Spec Food” items — including low-sugar and zero-sugar products — grew 27.4% year-over-year in the first quarter. The number of SKUs climbed from 220 last year to about 300 this year. “Interest in low-spec food has risen across many age groups, so we’re actively expanding these product lines,” a GS25 spokesperson said.

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