HASfter the symbolic threshold of ten euros was crossed in November 2020, the price of a packet of tobacco has remained relatively stable for two years. A lull which should however end. The government has now decided to index the price of a pack of cigarettes to inflation, in order to fight against smoking. Consequence: the pack of twenty cigarettes should reach eleven euros by 2024.
This measure should be taken as part of the 2023 budget and announced Monday, September 26 on RMC / BFMTV by the Prime Minister, Elisabeth Borne. “I confirm that the price of the package […] will rise like inflation. It would be quite paradoxical for the rise in cigarettes to be lower than inflation”, it would mean that “finally, relatively, the price would drop”, she explained.
A decision that already raises fears of a jump in illegal sales to tobacco companies.
The transition to 10 euros has proven to be “paying”
The Social Security financing bill (PLFSS) presented Monday, September 26 in the Council of Ministers provides that the average price of the package, “today 10.15 euros”, will increase by “50 cents in 2023 and 35 cents in 2024”, which “will increase it to 11 euros”, Bercy told Agence France-Presse (AFP).
The government is also announcing “new adapted tax scales” for products that are currently less taxed, such as rolling tobacco and heating tobacco.
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To justify this increase, the government argues that the tax increase from 2018 to 2020, which brought the pack of 20 cigarettes to 10 euros, paid off in terms of public health, by leading to an “unprecedented drop in the consumption of these products: – 22% in volume between 2017 and 2021” and around “2 million French people who have stopped smoking since 2017, according to Public Health France”, says Bercy.
However, after a tax freeze in 2021 and 2022, high inflation, if not passed on to tobacco prices, could lead to a “fall in real tobacco prices” and increase consumption, according to the ministry.
A gain in purchasing power
“If we let young people start smoking with a cheap packet, we produce the smokers of the next thirty years: but the real scandal is that at 14 or 15 they are already buying cigarettes without any control, at tobacconists, ”said Loïc Josseran, professor of public health and president of the Alliance Against Tobacco. “This important tax measure allows you to think about your consumption and gain purchasing power, knowing that quitting smoking is completely covered by health insurance. A minimum wage worker who quits smoking gets a third of his salary back,” he points out.
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Unsurprisingly, cigarette manufacturers protested against a “considerable tax increase” according to Jeanne Pollès, president of Philip Morris France, which produces the best-selling brand in the world, Marlboro. This will penalize “the poorest French people” and “aggravate the rise in trafficking in cheap fake cigarettes”, she told AFP. Same story at British American Tobacco (BAT), which evokes a “gift given to organized crime”, according to a spokesperson, predicting the appearance of “new counterfeit tobacco factories in France”, two of which were dismantled in this day.
The leading cause of preventable death, tobacco kills some 73,000 people in France, with a direct cost of 20 to 26 billion euros per year for health insurance and an overall “social cost” (deaths, illnesses, production losses , but also spending on prevention, repression and care, for the State) estimated at 120 billion by the French Observatory for Drugs and Drug Addiction.
Taxation on tobacco, it brings 13 to 14 billion euros per year to the State, according to Bercy. A year ago, a parliamentary report estimated the shortfall in tax revenue at 3 billion euros, linked to illegal tobacco consumed in France – estimated at between 14% and 17% of consumption.
Friday, September 23, the tobacconists demanded “a multi-annual visibility of taxation”, declared to AFP Philippe Coy, president of the Confederation of tobacconists, which represents the 24,500 tobacconists having the monopoly of the sale of tobacco.