Taxes Could Improve Health in France

March 25, 2014 Taxation in France

Healthy Foods FrancePARIS – The consumption of unhealthy foods could be drastically reduced in France, and the need for greater healthcare funding could be met much easier, by implementing new tax measures raised by lawmakers.

Late last week the Standing Committee of Social Affairs of the Senate of France presented to the members of the Upper House a new report focusing on the issue of “behavioral taxes”, and proposing a number of changes aimed at expanding the national tax base while making steps to improve the health of citizens.

It was noted in the report that a key to fostering wider acceptance by the public of health orientated taxes is to label them as a “contribution to public health” instead of “behavioral taxes”, as “…the term behavioral taxation has a moralistic nature and makes the citizen feel guilty.”

One of the major practical changes proposed in the report is implementing an annual 10 percent increase to the taxation of tobacco over the next five years, and aligning the tax rates of pre-rolled cigarettes and loose tobacco.

The report also calls for a new 20 percent tax to be applied to the sale of all drinks with a high sugar content, to cut the consumption of such products and to lower the associated risks of cardiovascular problems.

The taxes applied to the sale of vegetable oils should also be harmonized to remove any price discrepancies and to encourage the use and consumption of healthier oils.

It was also recommended to reevaluate which “healthy” foods should be eligible for reduced VAT rates, in order to ensure that the tax treatment of food is in line with modern practices and the government’s own funding and societal goals.

Explaining the need for a wide reaching overview of the government’s approach to health taxes, the authors of the report noted that “…if the consumption of tobacco, alcohol and unhealthy food is deemed high risk in relation to public health, then they are synonymous to considerable costs to society”, and targeted taxes and tax breaks ”… could therefore be envisaged as a way to reduce costs and generate the funds necessary to offset their negative externalities.”

Photo by: Sonny Abesamis