Smoking is getting more and more expensive. The price of the package of Marlboro, the first brand sold in France, will thus reach ten euros on March 1st. An effect of the tax hike policy aimed at reducing tobacco consumption in France.
Published in the Official Journal on Tuesday, a ministerial decree dated January 31 sets the new prices, up due to the application of the first tax hike of 50 cents, scheduled this year. The second increase is scheduled for November 1 by the government.
The Philip Morris group, whose market share is 40% in France, including 26% with its flagship brand Marlboro, will now sell the package of Marlboro Red at 10 €, against 9.30 euros currently. Another popular reference will increase by 60 cents: the Winston will drop to 9.60 euros, against 9 €.
Packages for sale over 10 €
The market leader therefore passed on the increase of 50 cents, and at the same time increased its margin from 10 to 20 cents per package.
The Marlboro package is however not the most expensive sold in France. The Gauloises brunettes from Seita (French subsidiary of the British Imperial Brands), which already cost € 10 since last November 1, will drop to 10.60 euros, and the Brown Gypsies to 11 €, compared to 10.50 euros previously.
However, the best sellers of Seita are brands that remain cheaper, the Gauloises blondes, which will go from 9 € to 9.50, and News and Co (9.40 euros against 8.90 euros). At Japan Tobacco International, the price of Camel without filter will increase to 9.80 euros, against 9.10 euros, again an increase of 70 cents.
Within the flagship products of British American Tobacco, the price of the Lucky Strike Bleu Classic will reach 9.40 euros against 8.90 euros previously. That of the Winfield Rouge will drop to 9.60 euros against 9.10 euros - an increase of 50 cents, a strict application of tax increases.
Falling sales
When he arrived in May 2017, the Macron government had ended four years of price stability, significantly raising taxes to bring the price of the package to around € 8 on March 1, 2018.
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Since then, Matignon has made two annual increases of 50 cents, scheduled one in March, the other in November, with the stated aim of reducing tobacco consumption.
These price increases caused sales to drop 9.32% in 2018 and 7.2% last year.
In France, it is the tobacco manufacturers who set the sales prices, but the State can encourage increases by varying the taxes, which represent more than 80% of the price. These price increases caused sales to drop 9.32% in 2018 and 7.2% last year.
According to the tobacco companies, this increase in taxation is causing the parallel market to explode. Evidenced by "customs seizures of illegal tobacco more and more," said Pascal Marbois, director of public affairs of British American Tobacco (BAT) France.
Seita also said he feared "a fall in tobacco deliveries to cross-border regions, which are suffering from parallel trade: they have already dropped by 10 to 15% last year," as Cyril Lalo, his head of institutional relations, says.
On the anti-smoking side, it is estimated that government policy, which combines higher prices with other measures - reimbursement for tobacco treatment, neutral package - has motivated a significant number of people to quit smoking.
