Beverage brands are poised to sue to UK government over chancellor George Osborne's new sugar tax which will add 24p a litre to products containing a high sugar content.
Industry bosses are now braced to sue the Conservative government over the tax, with the Sunday Times reporting that soft drinks makers will claim it's "discriminatory" because it will not hit other liquids with a similar sugar content such as fruit juices and milkshakes.
A senior industry source reportedly told the paper: “It’s fair to say we are more than just considering legal action. This has been rushed through without warning."
Designed to raise £520m a year for primary school sports initiatives, the levy was announced on Wednesday (16 March) to the dismay of drinks firms, with the Food and Drink Federation calling the move "a piece of political theatre".
If a legal challenge were to be presented it's likely to be brought through the European courts, with firms who are going to be affected such as Coca-Cola, Britvic and AG Barr set to get involved.
Successful lawsuits have been brought against similar taxes in Finland and Denmark, with the European Court of Justice vetoing the Scottish government's plans to enforce minimum alcohol pricing at the end of last year.