Sugar dissolving in water is a physical change and not a chemical one. Chemical changes only occur when new substances form. Dissolving sugar in water does not cause a chemical reaction to take place.
When sugar dissolves in water, the sucrose molecules remain intact, making this is a physical change. However, when salt dissolves in water, the sodium ions separate from the chlorine ions, resulting in a chemical change. In both cases, evaporating the water from the solution returns the original substance. While the two processes look very similar, the changes occur as the solid dissolves is different, and the classification of the changes differs.