The decision regarding whether or not to remove the cap that is placed on the increase in tobacco taxation that is indexed to inflation must be made by the executive branch prior to the presentation of the budgetary texts on the Monday following the previous one. Inflation must be taken into consideration in order to make this decision.
Should we get ready for a subsequent increase in the price of cigarettes over the course of the following few months? It is the question that will be acted upon in any case in Bercy, in complete preparation of the bills of the law of Finances and financing of the Social Security, which will be presented in the Council of Ministers the Monday following the one in which this sentence is written. The price of cigarettes is at the center of the debates, and the executive branch wants to change the legislation in response to the high inflation that is expected to reach 5.2% in 2022, according to the most recent forecast that was provided by the government. The executive branch wants to change the legislation because it is concerned about high inflation. At this time, a predetermined regulation is being strictly adhered to. Excise duties are subject to a maximum increase of 1.8% according to this rule, which governs the increase in excise duties in comparison to the inflation rate from two years ago. To put it another way, the price of a pack of cigarettes in 2023 would not see a significant increase because nothing had changed.
Read more about the 2023 budget in this related article titled “furious, the mayors count on the Parliament.”
Because of this, the objective of the government is uncomplicated: they want to remove the cap that has been placed on the increase in the tax that is indexed to inflation, and they want to use the price increase from the year before as the base rather than the price increase from two years ago. As a consequence of this, the rise in rights in 2023 would be some number in the range of 5% to 7.5%, depending on the inflation rate that was observed in 2022. This project is being led by the Ministry of Health and would be included in the budget of the Department of Social Security in 2023. The price of a pack of tobacco was raised to a minimum of ten euros during the previous term of Emmanuel Macron, which lasted for five years; the most recent increase took place in November 2020. When the price of a pack of roll-your-own tobacco increased to 15 euros, The Echoes reported that the price of each pack would increase by approximately 70 cents, bringing the total price to 11 euros. Le Figaro attempted to get the services at Bercy to confirm these figures, but the services there refused to do so and stated that “nothing is arbitrated for the moment.” It was mentioned in one of our editions on September 20 that another possibility that is currently being considered is an increase that would only apply to the packages that are the most cost-effective.