When selling or buying wine or spirits, it is important to know how much it will cost. Because any product sold in France or for export is subject to taxes or duties that must be taken into account. So, what are the taxes on alcohol? We present here the basics.
The first tax to apply on a bottle of wine or a bottle of alcohol is the VAT, or Value Added Tax. This tax on consumption applies to all products or services sold in France.
It is an indirect tax, paid by the final consumer, and collected by the professional who sells the product or performs the commercial operation. This tax must be declared to the public finance department.
Depending on the sector of activity, the nature of the product or service, and the location of the taxable operation, the VAT rate may vary. It can range from 5.5% to 20%.
Like any product sold in France, the sale of beverages is subject to VAT. Beverages are subject to different rates, depending on whether they are alcoholic or not.
The tax regime of a beverage depends on its tax definition. Alcoholic beverages that are subject to tax must meet the following criteria:
By definition, with an alcoholic strength by volume often between 10 and 15%, wine is therefore one of the alcoholic beverages subject to VAT. This is of course also the case for Champagnesparkling wines or stronger alcohols such as whisky, gin or rum.
The VAT rate applicable to these drinks is the standard rate of 20% . This applies to take-away sales, deliveries or consumption on the premises.
Also called "consumption duties", excise duties are an indirect tax on alcohol, but also on tobacco, oil or other luxury or polluting products.
Excise duties are applied on the quantity of products sold and not on their value. They are paid on behalf of consumers or retailers by importers or authorized warehousekeepers.
To certify the payment of excise duties, a duty representative capsule (DRC) is applied to a bottle of wine. Since June 1, 2019, however, this capsule is no longer mandatory for wines and Champagne; in this case, the seller is required to justify the payment of customs with by attaching the Simplified Accompanying Document (DSA) to his goods.
The amount of excise duty varies according to the tax category of the alcoholic beverage. Still wine, sparkling wine, cider, natural sweet wine, beer etc. do not have the same consumption rights.
Each year, the amount of consumption duty is set by a ministerial order.
In 2023, the duty rates are increased by 1.6% due to the inflation of 2021.
For wines and spirits, the rates are as follows:
In addition to VAT and excise duties, alcoholic beverages containing more than 18% vol. are subject to a third tax: the Social Security Contribution. Introduced in 1983, this contribution is allocated to the financing of health insurance. It was created "because of the risks that the immoderate use of these products entails for health".
As with excise duties, the social security contribution is paid by importers or authorized warehousekeepers for the consumer.
In the same way as the consumption duties, the rates of the social security contribution vary according to the tax category of the product. They are expressed in volume of beverage released for consumption for intermediate alcohols (€ / hl), and in volume of pure alcohol for spirits (€ / hlap).
In 2023, the CSS rates rates are as follows:
The VAT, excise duties and social security contributions mentioned above apply to the beverages mentioned on the French mainland.
There is an exception concerning the territory of Corsica.
In Corsica, alcoholic beverages sold in restaurants, bars or cafés benefit from a reduced VAT rate when consumed on the premises. This rate is 10%.
For sales to be taken away or delivered, the 20% rate normally applies.
In order to better understand and to see clearly, here is a practical case applied to a 75 cl bottle of wine with a 15 % vol. content sold in France at 20 € including VAT in 2023.
On a bottle sold for €20 including tax, the amount of tax is €3.359, or approximately 16.79% of the total price.
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