On Christmas Eve, the French government prepared itself an early Christmas present: President Emmanuel Macron promulgated the Loi d’orientation des mobilités, or Mobility Guidance Law, which sets a legislative framework to integrate environmental aspects into transportation policy. With the implementation of the bill two days later, France is now the first country in Europe to put combustion engine vehicle phase-out targets into law. Specifically, it states the intention to end the sale of new passenger cars and light commercial vehicles using fossil fuels by 2040. The legislation is yet another clear signal of the country’s commitment to electric vehicles and provides a pioneering example for other governments.
Various policy measures support France’s ambition to electrify its vehicle fleet. Strong fiscal measures currently in place include: a CO2 based bonus-malus vehicle tax when purchasing a new vehicle, a malus when buying a high-emitting second-hand vehicle, a conversion bonus for scrapping an old high-emitting vehicle in favor of a new or used low-emitting vehicle, and a CO2-based periodic tax on companies and private households for owning a vehicle.
The recent Finance Bill 2020, adopted in the end of 2019, includes an almost twofold increase of the maximum payable malus for new high-emitting vehicles, from a level of €10,500 in 2019 to €20,000 in 2020, as shown in the figure below. The French government also introduced a purchase price cap for vehicles eligible for the bonus payments and created separate systems for individuals and businesses. For individuals, the maximum bonus of €6,000 for vehicles with CO2 emission levels up to 20 g/km, primarily battery electric vehicles (BEVs) and fuel cell electric vehicles (FCEVs), is maintained but is now capped at a vehicle purchase price of €45,000. The bonus amount is halved to € 3,000 if an individual purchases an electric vehicle which costs between €45,000 and €60,000. For businesses, the maximum bonus is €3,000 if the vehicle’s purchase price is below €60,000. There is no bonus if the purchase price is greater than €60,000, with the exception of light commercial or fuel cell electric vehicles above €60,000, for which individuals and businesses receive a bonus of €3,000.
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SOURCE: ICCT
