VAT on champagne

Value Added Tax in France is a broad topic that professionals don't always understand. So when it comes to taxes on alcoholic beverages, it is even more difficult to understand how they work. Les Grappes gives you today the keys to be a VAT expert.

What VAT rate for Champagne?

Today, Champagne is subject to the standard VAT rate of 20%.

The VAT for alcohol

VAT is a tax that is added to the price of all products, including Champagne or wine. The value added tax is divided into four types.

• the super reduced VAT
• the reduced VAT
• the intermediate VAT
• the normal VAT

The tax rate is between 2.1% and 20%. Like many alcoholic products, Champagne is legally subject to Value Added Tax (VAT) at the standard rate.

According to the General Tax Code: Articles 278-0 to 279 bis, alcoholic beverages are subject to the normal tax rate of 20% for beverages to be taken away, delivered or consumed on site in France.

The exception is Corsica where alcoholic beverages taken away and delivered are subject to the standard VAT rate of 20%, but beverages consumed on the premises (notably sold in restaurants) are subject to an intermediate rate of 10%.

It should be noted that, in addition to VAT, there are two other taxes on alcoholic beverages excise or consumption duties and social security contributions.

Excise or consumption tax and social security contribution

Excise duty

Excise or consumption duty is an indirect tax levied on the consumption of certain products such as Champagne. Like VAT, the consumer pays this tax through the vendor, who is then responsible for reimbursing the tax to the State.

It is a tax on a quantity and not on a value: thus, the tax aims to collect N euros per hectoliter of alcohol sold.

The State determines a tax per hectoliter each year. In 2022, this tax amounts to 9.85 € / hl, or 0.07 € for a 75 centiliter bottle of Champagne with 10% alcohol.

The social security contribution (css)

The bottle of Champagne is subject to a third tax. The Social Security Code provides for a contribution on alcoholic beverages "because of the risks that the immoderate use of these products for health. ". This last tax is called the Social Security Contribution (CSS).

The State, according to article L 245-9 of the Social Security Code, determines each year a tax per hectoliter of pure alcohol (hlap). In 2023, this tax amounts to 589.00 € / hlap, or 44 cents for a 75 centiliter bottle of Champagne with 10% alcohol.

As for the excise or consumption rights, this tax is re-evaluated every year.

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