Faced with the fever of gasoline prices, Bercy releases the checkbook – latribune.fr

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Record fuel prices at the pump, soaring gas prices … for several months, the surge in energy prices has accentuated the pressure on the Ministry of Finance. After the energy check, the government is working on setting up a fuel check. On the antenna d‘Europe 1 this Monday morning, the Minister of the Economy Bruno Le Maire affirmed that he was more favorable to the establishment of such a device than to a reduction in fuel taxes.

“Today, a liter of diesel is 1.55 euros. On top of that, there are 60 cents of internal taxes on energy products and 30 cents of VAT. That makes 90 cents. euros in taxes. Some people tell us that it is better to lower fuel taxes. I do not believe that this is the right option. Firstly because it is very expensive. A penny lower the price of fuel That’s half a billion euros less. It’s unfair. Whoever takes his big diesel 4X4 will receive the same financial compensation from the state as a caregiver forced to take his Clio to travel the roads. ‘is finally a subsidy for fossil fuels, those we want to get rid of “ declared the tenant of Bercy.

A few months before the presidential election, the rise in energy prices could well derail the presidential strategy centered on the increase in purchasing power during the five-year term. The file is currently in the hands of Prime Minister Jean Castex. “The arbitrations will arrive in a few days. The modalities are not easy to put in place to target the right households” explains the entourage of the head of government questioned by The gallery.

Checks rather than lower taxes, a bad idea?

The implementation of a gasoline check should make it possible to limit the impact of a rise in fuel prices on French households. This option is far from being a panacea, however.

“The gasoline check provides a short-term solution. The problem with this check is that we are facing a universe of rising prices. A large part of the difficulties are either cyclical or structural. It may be necessary to reflect on the taxation of energy prices in the future. Energy prices will remain high for a long time. This is mainly due to chronic underinvestment in supply infrastructure and a change in the economic model of OPEC member countries. The European choice is to make an energy transition on renewables (solar, wind) where prices are less controllable “ explain to The gallery Christopher Dembick, economist at Saxo Bank.

Even if the executive believes that these measures should be transitory, the economist rather thinks that “these checks could well be perpetuated in the future”. For his part, Mathieu Plane, economist at the French Observatory of Economic Conjunctures (OFCE) recalls “that there is an experiment in the Hauts de France but this is not necessarily a measure that can be easily generalized to the scale of France. To respond to the emergency, it is necessary to create the gasoline check device from scratch. There needs to be transparency on the award criteria. “

In addition to the budgetary impact, one of the difficulties for the executive is to identify the households that would need it most. “We don’t have today, as for the check energy, a database of all the people who might need it. We don’t have a database of people who need their cars to go to work, for example “ explained the Minister of Energy Transition Barbara Pompili. “The advantage is that it is a measure which makes it possible to target low-income households whose effects of rising energy prices are felt. The difficulty is that it is necessary to take into account criteria of resources and to take into account the professional transport. The criterion of professional transport is more difficult to implement. Targeting can quickly become complicated to set up this device “ says Mathieu Plane. “The reduction in taxation would not go in the direction of an ecological transition and a reduction in inequalities. The targeting seems more reasonable but we must investigate this matter. It is a pity that the government did not have implemented earlier this measure “ he adds.

Inflation still driven by energy

The latest inflation figures unveiled by INSEE show that energy prices are pushing up general price increases. “This increase is visible everywhere in Europe. This is an increase that will continue in the coming months, particularly because of the winter. The impact of rising prices on energy markets will continue. It is estimated that we will have to wait until the third quarter of 2022 to observe a negative contribution from energy prices. Prices are likely to stay higher for longer than expected “ recently said ING economist Charlotte de Montpellier in charge of monitoring France.

In addition to the economic recovery, the statistical base effect on inflation could still play a role until April 2022. Indeed, periods of containment tend to dampen prices. The comparison over a rolling year of an indicator such as inflation can thus become delicate in a pandemic context. The return to “normalization” of the functioning of the economy could facilitate the interpretation of this indicator. Finally, core inflation, which excludes the most volatile prices such as energy, continues to fall to 1.3% in September from 1.5% in August.

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A possible impact on consumption

Soaring energy prices could have an impact on consumption, the traditional engine of the French economy. In fact, this increase directly affects households at the bottom of the scale, although they are those who most of the time have the greatest propensity to consume. “This transitional period can have an impact on the energy bill and therefore on consumption choices. Consumption could be lower than expected. This lower consumption could hamper the recovery a little “ Charlotte of Montpellier advances.

The memory of the yellow vests

The memory of the “yellow vests” revolt is not very far away. In November 2018, the increase in a gasoline tax set part of France roundabouts ablaze. In just a few weeks, groups of “yellow vests” had forced the government to react. The head of state Emmanuel Macron had to bring out an arsenal of measures intended to calm the anger of the demonstrators. To avoid a new episode, the executive seems to want to exclude the fiscal instrument. On this subject, it must be said that the risks of social implosion are numerous. A recent note of the Banque de France recalled that “a 1% increase in the price of imported refined diesel ultimately translates into a 0.75% increase in the price excluding VAT and 0.3% in the price including VAT at the pump in France”. For her part, Charlotte de Montpellier recalled that “Energy increases do not have the same impact on households. A household in a rural area may be more affected by the rise in gasoline prices. On energy, this may affect more households. precarious, as we have seen with the “yellow vests”.

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The hot topic of purchasing power before the presidential election

The rise in energy prices has brought the crucial question of purchasing power back to the center of the debate. Poll after poll, the wallet remains the main concern of the French. In the race for the presidential election, proposals emanate from all sides. On the right, the president of Hauts de France Xavier Bertrand has for example proposed to implement a work premium paid to all employees who earn less than 2,000 euros per month. On the left wing, Jean-Luc Mélenchon promises a minimum wage of 1,400 euros net per month. “Purchasing power is increasing on average but households do not necessarily feel these effects. The energy is cutting back on these announcements. […] Should the fuel check system be perpetuated? There is the fear of a crisis of yellow vests and a social crisis “ explains Mathieu Plane. A few months before the home straight for the Elysee, the pressure is increasing on the shoulders of Macronie.

Soaring energy prices should calm down in early 2022, according to IMF chief economist