The Brewers of Europe said on Tuesday that a proposed French law to raise the tax on beer by 160%, which passed through the National Assembly on Tuesday and is due before the Senate next week, would strike a death blow to thousands of jobs the sector supports and called on policymakers to reject the initiative.
"It is not my business to comment on the objectives of a law to finance social security in France," said Pierre-Olivier Bergeron, Secretary General of The Brewers of Europe in an open letter to policymakers. "But Europe’s 3,500 breweries, present in every single EU country, doubt the means, which penalise one sector to the point of preparing its demise."
This measure won’t just damage the fragile French beer sector but also any brewery exporting to France. Imported beer represents 30% of French beer consumption. Strangely, the proposed decision spares other alcoholic drinks categories this huge increase even though beer represents only 16% of the French alcoholic drinks market.
Bergeron added, “The decision is perplexing to say the least. Beer prices will soar in already declining cafés and brasseries that depend on beer for a third of their revenues. Jobs, which the government should be creating, will be lost in breweries, throughout the value chain and in the horeca sector, where 46,000 jobs are created by beer.”
While the 160% tax hike may increase the €337 million in excise duties that beer in France generates each year, it also puts at risk total government revenues of €2.6 billion derived from the production and sale of beer - VAT, excise duties, social security contributions and income taxes across the supply and value chain.
“This 160% tax hike is a kick in the teeth for a European brewing sector that has suffered greatly in the crisis, yet fought to survive and continued to invest in order to help play a positive role in the implementation of the EU’s Growth Pact,” Bergeron concluded.
