Intermarché boss calls on French state to reduce fuel taxes

The head of Intermarché has urged the French government to cut the level of taxes levied on fuel, as diesel prices climb back above €2 per litre amid renewed geopolitical tensions.

Thierry Cotillard said the state should reduce its margin rather than pressuring retailers to lower their own, arguing that supermarkets already operate on minimal or zero profit from fuel sales.

His comments come as the average diesel price in France increased by 6.5 centimes to 2.049€/l this week - a level not seen since 2022, during the energy crisis at the start of the war in Ukraine.

Petrol prices are close behind at 1.909€/l for SP 95 (E10).

You can check the price of fuel at stations near you in France at this official site.

The increase is linked to instability in the Middle East, which has pushed up global oil prices.

“Rather than putting pressure on our margins, the state should reduce its margin and things will improve significantly,” said Mr Cotillard at a trade event in Paris.

He added that retailers would pass on any wholesale price reductions “directly and in full” to consumers.

Supermarkets in France often sell fuel at cost price - plus sales taxes - to attract customers into stores, which leaves little room to absorb price shocks. 

Mr Cotillard described accusations that retailers inflate fuel prices as “intellectually dishonest”.

The intervention echoes similar remarks from Coopérative U chief Dominique Schelcher, who last week described the state as the “big winner” from rising fuel costs. He claimed that more than half of the price paid at the pump goes to taxes.

The call to cut taxes also follows the admission of competitor E.Leclerc that it cannot implement its proposed 30 centime price reduction, citing volatility in wholesale markets.

What are the taxes levied on fuel in France?

In France, fuel prices include two main levies: VAT at 20% and the TICPE (fuel excise duty), a charge fixed per litre at around €0.60 for diesel and €0.68 for petrol. Together, they account for a significant share of the final price.

However, the government disputes the idea that it benefits directly from price spikes. 

Officials at the economy ministry have said only VAT receipts increase when fuel prices rise, while the bulk of tax income from TICPE remains unchanged as it is set per litre, not as a percentage.

Energy minister Maud Bregeon has also ruled out cutting fuel taxes, calling such a move “inconceivable” given the potential €20billion shortfall it would create in public finances.

A meeting between fuel distributors and government officials last week ended without agreement on price controls or further relief measures.