🚨 Electricity - TICFE still reduced until January 31, 2024

To limit the explosion in electricity prices, the French government recently decided to extend the tariff shield in 2023, making it possible to limit the increase in electricity prices to +15% for small businesses and French households.

Regarding fiscal leverage, we suspected it but it is now written: the 2023 finance bill confirms the extension of the TICFE reduction until 31 January 2024.

A quick reminder of the TICFE

TICFE was formerly nicknamed the CSPE (Contribution to the Public Electricity Service). Originally, this tax was intended to cover several expenses related to the public electricity service:

• Policies to support the development of green energy sources;
• The additional costs generated by the obligation to purchase;
• The costs relating to the energy check for households;
• The budget of energy mediator ;
• The additional costs of electricity production in island territories (ZNI).

Since its creation in 2004, at the dawn of the opening of electricity markets, this tax has continued to increase until 2016 to reach the rate that was known until the announcement of its reduction: €22.50/MWh.

What are the impacts of reducing TICFE?

The reduction of Domestic tax on final consumption of electricity (TICFE) has remained unchanged since the announcement on January 28, 2022. The amount of the reduced TICFE is €0.50/MWh or €1/MWh depending on the sector and the subscribed power of the site:

• Businesses with a counter power <= 36 kVA: €1/MWh
• Companies with a counter capacity 36 kVA - 250 kVA: €0.50/MWh
• Companies and industries with a meter capacity > 250 kVA: €0.50/MWh
• Individuals: €1/MWh

This reduction applies to the quantities of electricity supplied between February 1, 2023 and January 31, 2024.

The fall in the TICFE made it possible to contain part of the increase in electricity prices.

Excerpt from the Finance Bill

The “tariff shield”, implemented between 1 February 2022 and 31 January 2023, made it possible to preserve the purchasing power of households and the competitiveness of businesses from the increases in electricity prices observed over the same period.
It includes a tariff component and a fiscal component. This article extends its fiscal component. Thus, it is proposed to maintain excise at the minimum levels allowed by European law (€1/MWh for households and €0.5/MWh for businesses). These reduced tariffs will apply uniformly in all territories where excise duty is levied, mainland and overseas, and to all electricity consumption, whether they are made for the needs of natural persons, businesses or legal persons other than businesses and whether or not such consumption currently benefits from a reduced excise rate.

As of February 1, 2023, the effects of the fiscal tariff shield will be amplified by the integration of the municipal tax on final consumption of electricity (TCCFE) into the excise duty. It will lead to an increase in its effects on the reduction in the level of taxation.

Thus, on 1 February 2023, taxation on electricity will decrease by €6.76/MWh for households and very small businesses and by €2.25/MWh for small and medium-sized businesses, at an additional cost to the State budget of €1.5 billion in excise duties over twelve months. Integrating TCCFE into excise will not affect the resources of local authorities. Indeed, the State will maintain their revenues through payments from the “Advances to local authorities” mission. PLF 2023 55 Finance bill

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