Tobacco prices: tobacconists lead the offensive in the media

In France, tobacconists are mobilizing to protest against the rise in tobacco prices, arguing the ineffectiveness of fiscal policies in public health, their role in the increase in parallel markets, and the deterioration of the economic conditions of the tobacconist network. However, such assertions do not stand up to scrutiny of the facts and scientific data.

Tax increases have not led to an explosion of parallel markets

On Monday, February 3, some forty tobacconist federations called for mobilization to protest against the increase in tobacco prices, presented as a factor in the increase in illicit trade. Thus, in his public statements, the president of the Confédération des buralistes endorses studies funded by cigarette manufacturers, estimating parallel markets at between 30% and 40% of national consumption. However, independent studies devoted to the evaluation of off-network purchases estimate that the latter are well below the industry's estimates. Thus, the survey conducted by Santé publique France indicates that tobacco purchases made in the tobacconist network represent approximately 80% of French national consumption, since at least 2014, despite the tax policies implemented since then. Furthermore, contrary to the discourse of the tobacco industry and tobacconists, data from Santé publique France shows that off-network purchases are essentially legal (cross-border purchases, duty free, purchases abroad), while illegal trade represents a marginal fraction of all purchases (less than 1%).

Price, one of the most effective levers for reducing tobacco consumption

The deliberate overestimation of off-network purchases, and particularly illicit trade, is a lobbying strategy that has been used for more than two decades by the tobacco industry, in France and elsewhere, to dissuade public authorities from implementing dissuasive tax policies. Such a discourse allows the economic sector to contest the effectiveness of public health policies, arguing that the latter, far from allowing a reduction in consumption, simply encourage smokers to turn to the illicit market. However, the effectiveness of tax increases on all tobacco products, when they are regular and significant, is the subject of a well-established scientific consensus. Based on extensive media coverage, some tobacconists are calling for a tax moratorium on all tobacco products, or even a reduction in taxes. Frédéric Pailhé, president of the Occitanie tobacconists' federation, also calls on governments to review public health policies: " "To do prevention, to raise awareness about the harmfulness of the product, yes. But we must stop increasing prices." In fact, limiting public health policies to prevention and awareness measures is a regular demand from the tobacco industry, precisely because of the inability of this strategy alone to reduce consumption.

Tobacconists, a very healthy profession

In many media outlets, particularly local ones, tobacconists deplore the deterioration in the economic health of tobacco retailers. Thus, on France 3, Thierry Moreno, president of the Bas-Rhin tobacconists' confederation, believes that "each increase in tobacco prices is a stab in the back", insisting on the lack of consideration of the public authorities towards this profession: "if we were an SME type company, everyone would pay attention to us, but we are independent: no one cares". Such statements are, however, unrelated to reality. Thus, according to INSEE's own data, the turnover of tobacconists on the sale of tobacco products increased by 100%, precisely because of the increase in their selling prices. Indeed, since tobacconists' remuneration is proportional to the retail price of tobacco, the more it increases, the more tobacconists are paid. At the same time, tobacconists have been the subject of massive financial support from the public authorities, estimated at 4.4 billion euros over the past twenty years.

FT

National Committee Against Smoking |