Inflation: the government could increase taxes on cigarettes

A pack of cigarettes of more than 11 euros. This is what could very well be the norm in 2023. In fact, the government is considering taxing tobacco more, according to information from our colleagues. echoes. Although the Treasury and Social Security Financing Bill (PLFSS) will be presented on Monday, the automatic rule to increase special taxes in accordance with inflation could be revised.

Currently, the law indicates that this increase must be calculated in relation to the price of year N-2, and with a limit of 1.8%. With this calculation method and the ceiling well below inflation, cigarettes and other rolling tobacco would clearly be protected from price increases.

New financial resources

But not everyone hears it the same way. In the Ministry of Health in particular, there is pressure to remove the cap on this calculation method by modifying the legislation in the PLFSS, to take the year N-1 as the base. That is, duty increases from 5% to 6% at the beginning of 2023 (according to the inflation observed in 2022), “up to 7.5% adding observed price increases in 2021 and 2022”, according to Les Échos. Simply put, the best-selling packs of cigarettes could cost 70 cents more. For example, a pack of Marlboro, one of the best-selling brands in France, could go from 10.50 euros to more than 11 euros.

On the Bercy side, we decline to comment. But in the entourage of the Budget Minister, Gabriel Attal, it is recognized that, this year, the new financial resources or savings will come from the PLFSS. The new tobacco tax could therefore be one of them.

However, the measure would not be fully resolved. Some elected officials consider it highly unpopular – in a context of high inflation with, in particular, the rise in the price of gas and electricity in 2023 — while there are still 15 million smokers in France.

An “economic disaster” for tobacconists?

On the side of tobacconists, reticence is also heard. “We obtained from the government a tax freeze in 2021 and 2022, after the great 2018-2020 trajectory, and of course, this issue (…) is the subject of negotiations between us, Customs and Bercy”, Philippe Coy recalled for the first time. . , president of the Confederation of tobacconists. Then to add: “At the moment there is nothing arbitrated but it will not be for a long time (…) I am worried: the fiscal tool has been used for 20 years, and that has increased the parallel market, and resulted in an economic disaster for our network with 10,000 establishments closed in 15 years”.

For the president of the Confederation of tobacconists, which will hold its annual congress on October 20 and 21 in Paris, any increase should be “very moderate, around 20 cents per year.” And claim the “multi-annual visibility of taxation, as in the previous five-year period”, allowing professionals to “steer the transatlantic and find the right directions”.

In France, some 24,500 retailers live from the monopoly of tobacco sales, which generates between 60 and 80% of their income.

Leave a Comment

Your email address will not be published.