France Cuts VAT on small residential solar installations to 5.5%— driving greener agenda
France is making a move toward cleaner energy by introducing a reduced VAT rate of 5.5 % on residential solar panel installations under 9 kW, effective 1 October 2025.
While the official decree detailing the qualifications is still pending, the draft conditions are set to be reviewed by the Higher Energy Council on 4 September 2025.
Thanks to 2025 EU VAT rate freedom measures, member states now have more flexibility to offer reduced or zero VAT rates on energy-saving materials—paving the way for more green incentives. Separately, the EU VAT for green polices is part of the VAT beyond ViDA review.
Draft requirements for the reduced VAT
To qualify for this eco-friendly VAT cut, solar panels must pass stringent, manufacturing-focused criteria—not performance-based thresholds. Panels must meet all of these:
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Carbon footprint < 530 kgCO₂‑eq/kW
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Silver content < 14 mg/W
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Lead content < 0.1 %
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Cadmium content < 0.01 %
These targets are intentionally steep, aiming to steer the market toward low-carbon, low-toxic metal panels that support environmental sustainability.
Read more background in our French VAT guide.
Certification of compliance is required by accredited bodies, with documentation covering:
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Traceability of production facilities for modules, cells, and wafers
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Evidence of a factory audit within the past 12 months
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Results for each of the four thresholds above
Certifications will be valid for one year—ensuring regular oversight and quality. The full decree’s release is eagerly awaited following the council review.
Current VAT Landscape: EU & UK Comparisons
Many other EU states have moved ahead with VAT rate cuts on solar panels:
- Germany – 0 % (since Jan 2023)
- Austria – 0 % (since Jan 2024 through 2025)
- Belgium – 6%
- Netherlands – 0%
- Italy – 10%
- UK – 0%
