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Tax Credits: Launching of "C3IV" for Companies Committed to Energy Transition

The French Green Industry Investment Tax Credit (GIITC) came into effect on March 14, 2024. Its objective: to encourage companies to invest in industrial projects in sectors crucial to the energy transition: "batteries, wind power, solar panels, and heat pumps".

Reading Time : 1 minut(s) - | Updated on 29-03-2024 17:08 | Published on 25-03-2024 14:28 

Support for certain targeted industrial projects

How can businesses be encouraged to commit to greening the economy? The government has bet on implementing a targeted tax advantage through the "C3IV". This new tax credit is presented as one of the pillars of the national strategy to strengthen France's energy sovereignty and boost its economy through a "greener" industry.

Effective from March 14, 2024, the scheme specifically targets companies involved in the production of equipment dedicated to these sectors, the manufacture of essential components mainly used for this equipment, and the production or valorization of critical raw materials required.

To be eligible, companies must therefore demonstrate that more than half their turnover is generated by the sale of products or services to other firms, these having to be further down the production chain of the specifically targeted sectors. This condition aims to support economic activities that directly contribute to the development and expansion of the green industry, ensuring an impact that the State hopes will be significant on the value chain of these crucial sectors for energy transition. Note that the support for the acquisition of goods is specifically excluded from the scope of the tax credit.

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A tax credit for projects that must be approved by the authorities

The C3IV is calculated from physical and intangible investment costs, with a base rate of 20%, subject to increase for projects located in areas with regional objectives and for small and medium-sized businesses.

Access to the tax credit requires prior approval from the General Directorate of Public Finances (DGFIP), backed by the opinion of the Agency for Environment and Energy Management (ADEME).

Companies wishing to benefit from this tax credit must thus submit an approval application, making sure to do so before the start of any construction work related to the project. This process ensures that supported projects align with France's energy transition objectives while respecting the criteria set to encourage a sustainable green industry. They can submit their approval application via the dedicated online service opened by the General Directorate of Public Finances (DGFIP). The processing time is set at three months for a complete file.

To date, about twenty candidates have already made themselves known to the state services, representing a total investment of 1.8 billion euros and the creation of 40,000 direct jobs by 2030 according to Les Echos.