Excise duty refund on diesel for road transport: publication of new refund rates

UNWRAPPING THE FRENCH SUGAR TAX: A SWEET SOLUTION TO SUPPORT PUBLIC HEALTH

Introduction

France has implemented specific contributions on soft drinks containing added sugars or synthetic sweeteners (e.g. diet drinks). These "Sugar Taxes" aim to tackle excessive sugar consumption and to promote healthier dietary choices.

What is the French Sugar Tax?

The French Sugar Tax, known as "la taxe sur les boissons sucrées et édulcorées" is a tax imposed on sugary beverages, including sodas, energy drinks, and other sweetened beverages with added sugars or synthetic sweeteners. It is intended to reduce the consumption of these high-sugar products, thereby addressing health concerns.

To do so, French regulations have implemented two separate taxes: one on beverages containing added sugar; and the other one on beverages containing synthetic sweeteners. Together they are designated as “French Sugar Tax”.

Implementation and Collection

The implementation of the French Sugar Tax involves several key components:

1. Taxable Products:

The tax applies to beverages:

Falling within CN codes 2009 (fruit or vegetable juices) and 2202 (mineral and aerated waters containing added sugar or other sweetening matter)
Packed in retail containers (e.g bottles, drums, cans, etc.)
With added sugars and artificial sweeteners in any quantity
And of an alcoholic strength not exceeding 1.2% abv, or 0.5% abv for beers

It covers a wide range of products, including carbonated soft drinks, energy drinks, fruit drinks with added sugar or sweeteners, and concentrated syrups that consumers dilute.

Exclusions

In particular: milk, yoghourts, syrups falling within CN 1702 or 2106, and alcoholic beverages (the latter can be, under conditions, subject to premix tax when they contain sugar).

2. Tax Rates:

The government has adjusted these rates over time to reflect its health objectives.

For the tax on added sugar, the tax rates are based on the sugar content per hectoliter. The applicable rate is exponential, being higher for beverages with more sugar. As an example:

3.17€/hl for beverages containing less than 1kg of sugar per hl
24.78€/hl for beverages containing 15kg of sugar per hl

As for the tax on synthetic sweeteners, rate is set to 3.17€ per hectoliter.

Note: When the product contains both added sugars and sweeteners, the sale is subject to the two taxes.

3. Liability:

Manufacturers, importers, or distributors of the taxed products are responsible for calculating, collecting, and remitting the tax to the French DGFIP authority.

The French Sugar tax is payable by person who delivers the beverages under a retail packaging to France for the first time, whether for consideration or free of charge.

In practice, this usually involves the first sale of taxable products by the manufacturer in France, or by the person bringing them into France (in the case of an intra-Community acquisition or import from a third country).

The French Sugar tax is a crucial step in addressing the rising health concerns associated with excessive sugar consumption, as the government evaluates and adjusts tax rates to meet its health objectives. In this framework, we recommend operators to carefully verify the taxable event of this Sugar Tax on their operations, to ensure that they are not wrongfully avoiding the taxation.