The Medef and employers’ organizations warn of the economic consequences

Economic stakeholders fear a significant increase in taxes on Réunion rum as part of the proposed tax on spirits put forward by Senator Stéphane Fouassin.

The Medef Réunion, the CPME (Confederation of Small and Medium-Sized Enterprises), the ADIR (Association for the Development of Rural Areas), and the Sugar Syndicate have sent a letter to the President of the Departmental Council, Cyrille Melchior, requesting the suspension of the proposal and the opening of consultations with all stakeholders.

According to them, this tax could increase the cost of local rum by approximately €1,600 per hectoliter of pure alcohol, or nearly €8 per bottle, while imported rum would be taxed at only €200. The organizations believe such a difference would be unfair and could harm the competitiveness of local producers.

The business community points out that the rum industry is primarily composed of small and medium-sized enterprises, which lack the financial resources to withstand such a tax shock. It represents approximately 1,200 direct and indirect jobs and plays a key role in the sugarcane-sugar-rum-energy sector, which accounts for nearly 15,000 jobs in Réunion.

Beyond rum, the signatories warn of the potential impact on the entire sugarcane industry. Weakening the local rum industry would weaken sugarcane production and all the economic activities that depend on it.

The organizations state that they share the objectives of public health and the prevention of excessive alcohol consumption. These stakeholders simply request that the measure be discussed with all relevant parties in order to find a balance between consumer protection and preserving the local economy.

This stance comes after the Finance Committee withdrew an amendment proposed by Member of Parliament Philippe Brun at the request of the Regional President, Huguette Bello. The Department reminds everyone that the tax remains optional and adjustable each year, allowing us to maintain an advantage for Réunion rum while limiting the risks associated with overconsumption of strong alcohol.