The French wine based products market

French deputies have voted an amendment proposal on the 24 of October which goal is to enlarge the premix beverage taxation to “Wine based beverages”. Indeed, the initial’ premix tax aimed premade mix (distilled alcohol such as Rhum or Vodka mix with soft drinks). As a reminder this category of premade cocktails “ready to drink” have to express a maximum of 12% alcohol content and are taxed 11€ the decilitre of pure alcohol.

With the amendment, the wine-based beverages would be now taxed on the base of 3€ the decilitre of pure alcohol which would cause total price (VAT included) increase of about 70% for the consumer!

Such increase would impact sales of products from this category that already shows a decrease in the mass retail since the last 3 years. The french wine association strongly protest against of this tax as this may be a major blow for French wine producers which are already struggling to sell their production and are benefiting of this salutary’s market of wine-based products to get the most of the game.

The main government goal is to finance the French social security system by taxing more alcohols. The other goal put forward is to avoid risked behaviours with alcohol consumption, mostly young users.

However, statistics show those wine-based beverages (rosé wine with pomelo juice or red wine and coke) are rarely consumed by teenager but mostly by 35 years plus.

If the amendment is adopted, this will be the first tax to guide the behaviour of the French consumers about wine and by products.

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