Can a discount on a heat pump affect eligibility for the 5.5% VAT rate in France?

Reader question: We were pleased to read the news about the significant reduction in VAT for residential heat pumps, from 20% to 5.5%. I contacted our electrician, and he said that the reduced VAT rate can only be applied to the full price of the equipment. If he discounted the retail price, the old 20% VAT rate would apply. Is this correct? 

It is true that since July 18, 2026, eligible fixed reversible heat pumps, which provide both heating and cooling, can benefit from the reduced VAT rate of 5.5%, provided they meet specific conditions relating to their performance, environmental impact, refrigerant and connectivity requirements.

However, we have not found any rule stating that this reduced rate can only be applied to the full retail price of the equipment, or that a discount would automatically mean that the standard 20% VAT rate must be charged.

In fact, the general VAT rules suggest the opposite. French tax law states that discounts granted directly to customers are not included in the VAT calculation. 

Thus, VAT is normally calculated on the actual price paid after the discount has been applied.

Discounting changes the base on which VAT is applied, not the VAT rate.

The new heat pump rules specify which equipment qualifies for the reduced rate and the technical conditions it must meet, but they do not appear to make eligibility dependent on no discount being offered.

The electrician may have his own interpretation of the rules or an internal policy, but we have not identified any legal text supporting the idea that a discount would prevent the application of the 5.5% VAT rate. 

We would suggest asking which specific tax law he is relying on for this position.

You can also check out in our article on which heat pump is best for your home.