French parliament pushes for HFC tax adoption

MPs from France’s governing parties have reinserted a proposed HFC tax into the 2019 Finance Bill. But the tax may not survive parliamentary debates over the adoption of the bill.

A proposed HFC tax and support mechanism for companies using natural refrigerant-based technology have reappeared in France’s 2019 Finance Bill as an amendment supported by French President Emmanuel Macron’s LREM party and its coalition partner MoDem.

The so-called bonus-malus scheme would gradually tax users of HFC-based HVAC&R equipment users from 2021, and offer corporate tax discounts to companies investing in natural refrigerant-based equipment.

The amendment aims to introduce a progressive tax levied as of 1 January 2021 on producers and importers of HFCs. The tax is set at 15 euros per ton of CO2 equivalent (€/tCO2e) in 2021, €22/tCO 2e in 2022, €30/tCO2e in 2023 and €45/tCO2 e in 2024.

If adopted in parliamentary debates, the HFC tax scheme will also update the corporate tax code. Companies subject to corporation tax or income tax under a real tax regime may deduct from their taxable profit an amount equal to 40% of the original value of all natural refrigerant-based refrigeration and air conditioning equipment.

This discounted tax rate applies to companies acquiring new natural refrigerant-based equipment from 1 January 2019 until 31 December 2022.

The proposed measures still need to be approved in parliamentary debates. Final votes will take place at the end of December 2018.

By Marie Battesti

Oct 09, 2018, 11:23

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