Stephane Remael for The New York Times
Beer drinkers at Chez Prune in Paris. A half-pint of beer may cost 6 cents to 60 cents more if a tax increase is approved.
PARIS — Simon Thillou likes to think of La Cave à Bulles, his shop here devoted only to beer, as a place where beer lovers can gather to taste new brews and, of course, discuss the state of the world. But this was one controversy he never saw coming, and wishes he never had: a proposed 160 percent increase in the tax on beer.
“The increase is brutal; 160 percent is a lot,” said Mr. Thillou, 36, who prides himself on promoting French microbreweries. On a barrel near the entrance, a pile of fliers that say “+160% taxes on beer: Who is going to pay the price?” shows what he thinks of the government’s latest plan for raising revenue.
It is not just the tax increase — which would raise prices by 25 to 40 cents per bottle — that has him upset. “I am shocked that beer is the only target,” he said. “I am shocked that other alcohol producers aren’t affected.”
Winemakers come in for particular criticism. “Wine growers aren’t behind the nation, but the nation is behind them,” he said.
Complaints about the tax increase are coming not just from customers, but from brewers, the food industry generally and politicians, who know that some voters, at least, like French ales. They say the government’s public health arguments are an excuse to single out beer, instead of spreading the pain across all alcoholic drinks.
“If we want to keep industries and economic sectors, we can’t do any old thing,” said Bernard Gérard, a center-right politician in the National Assembly, Parliament’s lower house. “Increasing excise duties by 160 percent seems completely unreasonable to me.”
Having promised to reduce France’s budget deficit, the new Socialist government has proposed about $30 billion in new taxes. The increase in the beer tax is expected to generate an additional $625 million.
The social security budget, which is in the final stages of the legislative process, also includes heavier taxes on tobacco and new ones on energy drinks.
According to government estimates, the higher tax will increase the price of a half-pint of ordinary beer by approximately 6 cents. (A half-pint of an average beer at a bar costs about 2.60 euros or $3.40.) But brewery and food industry lobbies say the increase will be considerably more because of a multiplier effect as each step of the distribution chain recalculates its profit margins, reaching 25 cents to 60 cents for the final customer.
The lobbyists fear that consumption will drop, pulling down production and threatening jobs and investment, especially for small breweries that do not have the international flexibility of European giants like Heineken or Anheuser-Busch InBev.
The French beer industry represents two billion euros in sales, or about $2.6 billion, and more than 71,000 jobs, according to the Brewers of France, a lobby that represents 80 percent of the industry. It says that 70 percent of the beer consumed in France is brewed domestically.
Laurent Lutse, president of the cafe, bar and nightclub branch of France’s main food and hotel union, said that beer represents 25 percent of sales in 80,000 member companies and worried that a tax increase would accelerate the decline of such establishments. “In France in 1960 there were still 200,000 bistros,” Mr. Lutse said. “There are fewer than 35,000 left, which means there are fewer bistros than there are church towers.”
Despite the complaints, the tax increase is expected to pass in the Socialist-dominated National Assembly.
Many opponents of the bill suggested that wine was exempted because the industry has greater political clout, given that it is one of the country’s top three exporters and employs 250,000 people. Wine is currently taxed around the same rate as beer, per hectoliter, but unlike the rates for beer, its rates do not increase with the degrees of alcohol.
Paris Journal: In France, Beer Lovers Chafe at Tax Increase Plans
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Paris Journal: In France, Beer Lovers Chafe at Tax Increase Plans
