HFC tax, natural refrigerant incentives adopted in France

France’s 2019 Finance Bill, officially adopted on 30 December 2018, confirmed the entry into force of a tax on HFCs as of 2021 – minus a cancellation clause that it had previously contained. The new French scheme will also support the adoption of HFC alternatives from 1 January 2019 until 31 December 2022.

To help companies to transition to HFC-free alternatives, an income tax discount is applicable until 31 December 2022 for companies subject to French tax.

Companies can deduct from their taxable profit an amount equal to 40% of the original value of all HFC-free refrigeration and air conditioning equipment – including that based on natural refrigerants.

The tax discount of 40% for HFC alternatives is applicable for the next four years, for new refrigeration and air-conditioning installations.

The  tax rate increases over time, and is set at 15 euros per ton of CO₂ equivalent (€/tCO₂e) in 2021, €18/tCO₂e in 2022, €22/tCO₂e in 2023 and €26/tCO₂ e in 2024 and €30/tCO₂ as of 2025.

The tax applies to the entity that makes the first delivery of HFCs in France (producers and importers).