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France is taking bold steps to address rising inflationary pressures on households by temporarily lifting the long-standing ban on retailers selling road fuel below cost. Prime Minister Elisabeth Borne shared this decision in an interview with Le Parisien, aiming to provide immediate relief to consumers grappling with surging pump prices.
Renewed Efforts to Combat France Inflation
The recent spike in fuel prices during the summer has posed challenges for the government’s efforts to curb consumer inflation. In response, ministers have urged both fuel and food industries to reduce their profit margins. TotalEnergies has already extended a cap on fuel prices beyond the year’s end, while certain supermarket chains have initiated promotions to sell petrol at cost.
Removing a Decades-Old Barrier
However, a longstanding ban, dating back to 1963, has hindered distributors from further reducing fuel prices. Prime Minister Borne announced the lifting of this ban for “several months” to ensure tangible benefits for the French population without resorting to fuel subsidies.
“We will achieve concrete results for the French people with this unprecedented measure, all without subsidizing fuel,” Borne emphasized.
No Tax Cuts, Focus on Corporate Responsibility
Borne rejected the idea of reducing fuel taxes, citing the imperative to address the public deficit and debt. Instead, she underscored the importance of large companies playing their part in these trying times.
Finance Minister Bruno Le Maire also voiced concerns about high petrol refining profit margins. In addition to, hinted at possible government intervention to address this issue.
France inflation fuel retailers
In addition to the fuel sector, Borne highlighted measures to address food prices. Starting in November, companies will be obligated to indicate on product labels when they alter the size of a product. This move seeks to tackle “shrinkflation,” where products are sold in smaller quantities without any price reduction. Thus, a practice that has stirred controversy in food retailing during recent price spikes.
French supermarket chain Carrefour recently announced its intention to place signs in its stores next to products found to employ such practices, taking a proactive stance in addressing this issue.
In summary, France’s decision to temporarily allow fuel retailers to sell below cost is a noteworthy move in the fight against France inflation, with the government emphasizing the need for corporate responsibility and transparency in pricing practices across sectors.
Disclaimer: This article serves solely for informational purposes and should not be construe as financial advice. Thus, we strongly advise readers to conduct thorough research and consult with financial professionals before making any investment decisions.
