Healthy Food

do the revenues exceed the costs?

To curb the consumption of cigarettes, a professor of medicine recommends to often increase the price of the packet. On the occasion of the tobacco-free month, Le Figaro examines the relationship between tobacco revenue and the cost to the State.

It was one of Emmanuel Macron’s flagship promises in 2017 in terms of public health. The price of the pack of red cigarettes, the most sold in France, exceeded the symbolic bar of 10 euros in March 2020. But do these successive increases in the price of the pack allow the State to achieve a balance, to a strictly financial point of view, between revenue and expenditure related to tobacco?

26 billion euros in 2015

Tobacco cost the state 26 billion euros in healthcare in 2015 while taxes brought in 11 billion. The package should be 45 euros to compensate for all its effects. 10 euros is a step, not a goal », Details Professor Loïc Josseran, Head of the Public Health Epidemiology Department at the Raymond Poincaré Hospital in Garches. 26 billion euros, it is therefore the economic cost which includes the expenses of care (cancer, cerebral vascular accidents, other pathologies). A “drop of water” when compared to the social cost of tobacco: 122 billion euros in 2015, according to the French Observatory of Drugs and Drug Addiction (OFDT).

According to Pierre Kopp, lawyer at the Paris bar and professor at the University of Paris 1 Panthéon-Sorbonne, who carried out the calculations for the OFDT: “ The social cost is broken down into the external cost, which does not correspond to a disbursement but to the valuation of what is lost, and that for public finances, which is more appropriate than the notion of economic cost. Contrary to what the ‘tobacco lobby’ claims, they greatly exceed the gains “. Asked about the subject, a regional union of tobacconists did not wish to comment.

Admittedly, the data on which the 2015 OFDT study is based date back to 2010 and the proportion of smokers has since decreased (29.7% daily smokers compared to 24% in 2019 according to Public Health France) but in terms of policy of health the time is very long. ” Tobacco control policies take years to bear fruit. We still pay today for the smoking of the 1970s and 1980s. If lung cancer slows down in men, it explodes in women. The important thing today is that young people do not start smoking. For this, we know the fatal weapon: the increase in the price of the package which passes through taxation for the purpose of public health “, adds Professor Josseran.

SEE ALSO – Belgium: seizure of 20 million counterfeit cigarettes destined for France

Hit fast and hard

While he concedes that the government conducted a proactive policy in 2017, efforts are running out of steam: “Olivier Véran has been absent from the debate since the start of the tobacco health crisis. It is even more shocking to hear Olivier Dussopt take up the verbatim of the tobacco lobby to position himself against price increases [le 29 septembre 2020, le ministre chargé des Comptes publics indiquait sur BFMTV qu’il n’y aurait pas hausse de la fiscalité sur le tabac en 2021 car la cible du prix moyen du paquet à 10 euros avait été atteinte ; le prix est toutefois resté indexé à l’inflation NDLR]“. The doctor confirms that smuggling represents only 5% of the market in France.

The background report “Evolution of Tobacco Consumption and Tobacco Product Taxation Yields During Lockdown and Lessons Learned,” co-reported by Eric Woerth and Zivka Park in September 2019, provides more details on the parallel market (legal purchases made abroad and illegal behavior including smuggling). IsleIt is also much more important in the border departments, where it represents nearly 30% of the volumes of tobacco consumed. As a result, the tax revenue losses generated by the parallel tobacco market are between 2.5 and 3 billion euros per year.“. The fight against street vending is a priority for tobacconists.

Professor Loïc Josseran recommends hitting the wallet hard and regularly. Because if the price shocks are not brutal, smokers internalize the increase. Same story on the side of Pierre Kopp: “Agnès Buzyn was proactive. In return, it is necessary to finance weaning devices and to be intransigent on attempts to circumvent the Evin law, on social networks in particular.“. On RTL in September 2019, the former Minister of Health claimed that 1.5 million French people had quit smoking in two years.

On the industrial side, the state would not be a winner either. “It is a dead loss from a tax point of view (apart from tobacconists) because there is no longer a production site in Franceconcludes Professor Josseran. Obviously, this economic approach is partial. Some 75,000 people die in France each year from tobacco, according to the OFDT.


SEE ALSO – Cigarettes: should the price be increased further?

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