WHERE AUSTRIAN ECONOMICS MEETS REAL WORLD ACTION

France's new tax break for robots pays a small firm up to twice what it pays a slightly bigger one. It rewards whoever orders new, on time, and stays small.

You run a precision machining shop with 47 people on the payroll. Aerospace parts, mostly, and the fullest order book in years.

On your desk is a quote for a five-axis machining centre: €400,000, delivery offered for the week before Christmas.

Next to it are the CVs of four people you want to hire before spring.

Your accountant says the government will pay part of the cost through your tax bill. Then she asks two questions: when exactly does the machine arrive, and how many people will you employ this year?

You thought you were buying a machine. You are also choosing a delivery date and a headcount.

On 1 October 2026 the French government presented its 2027 finance bill to the Council of Ministers and tabled it in the Assemblée nationale the same day, as bill n° 3210. Article 9 creates a new tax deduction, article 39 decies H of the tax code, which the government calls a suramortissement « industrie 4.0 »: an extra deduction, on top of normal depreciation, for new equipment used in industrial production.

It is open to small and medium-sized enterprises, and to mid-sized firms (the French category of entreprises de taille intermédiaire, or ETIs), taxed on their actual profits. Larger companies are excluded. The equipment must be bought new, recorded as a fixed asset, and used in an activity that "contributes directly to the manufacture or transformation" of physical goods and in which machinery and tooling play the "predominant" role. Eight categories qualify, from robots, cobots, 3D printers and numerically controlled machines to production sensors and design, manufacturing and maintenance software.

The rate depends on the firm's size and on whether the machine sits in a zone on the EU-approved regional-aid map, where larger subsidies are allowed. Size follows the EU definition: a small firm has fewer than 50 staff and turnover or balance sheet of no more than €10 million; a medium-sized firm has fewer than 250 staff and turnover of no more than €50 million or a balance sheet of no more than €43 million. Size is measured at the end of the financial year before the purchase.

What the deduction is worth on €100 of new kit

The table uses the 25% tax rate in the government's assessment; a firm's actual saving depends on its own tax rate. The deduction is spread evenly over the machine's normal working life. It covers kit firmly ordered from 1 October 2026 and acquired between 1 January 2027 and 31 December 2029, or later if ordered by the end of 2029 with a deposit of at least 10% and delivered within 36 months. Under a crédit-bail (a French lease with an option to buy the machine at the end) signed in those years, the lessee takes the deduction, not the leasing company.

This is a bill, not yet law. This issue follows the text as tabled on 1 October 2026; any changes made by the Assemblée's finance committee are not yet known. Floor debate is scheduled from 13 October. If Parliament has not decided within 70 days of tabling, the Constitution lets the government bring the bill into force by ordonnance.

The government's case is specific. Its own assessment reports that only 39% of small and medium-sized firms said they invested in 2025, against an average of 55% since 2001, and that the average French machine is 17 years old, against 15 in the 1990s. A narrower deduction for robots in 2019 and 2020 is estimated to have raised investment by small industrial firms by 12% to 14% a year between 2019 and 2022, at a tax cost of about €4 million a year. The new scheme is costed at €161 million in total, none of it in 2027.

The government also chose a tax rule over grants, and gave three reasons: grants favour firms with staff to fill in applications, open-ended grant schemes are hard to plan around, and a deduction applies automatically to every eligible firm.

Take every word of that as true. What follows is unaffected.

Two numbers on the same machine

The price of the machine is still agreed between a buyer and a seller who could each walk away. What changes is what the machine costs the buyer once tax is counted. That number is now set by a list and a calendar.

The government's own assessment shows how the rates were chosen. The tax savings in the table, 10%, 20% and 30% of the cost, are the ceilings EU state-aid rules allow for each kind of firm and region, and the assessment notes that each rate "mechanically" respects them. The rates measure what Brussels permits, not what any machine is worth to anyone.

Take two machines that do the same job: a refurbished one at €150,000 and a new one at €220,000. For a small firm outside the regional-aid zones, the new machine now saves €44,000 of tax over its life; the refurbished one saves nothing, because only new kit qualifies. A €70,000 gap shrinks to €26,000. The question that should decide the purchase, which machine serves my customers best for the money, now shares the table with another: is it on the list?

Who collects first

The deduction only reduces tax where there is profit to set it against. The government justifies the higher small-firm rate by their "weak capacity for self-financing and access to credit". Yet the firm with the thinnest profits gets least from a deduction, and gets it latest. A deduction reaches profitable firms first, including those that would have bought anyway.

The assessment expects about 6,050 firms to claim, roughly double the 2019-2020 scheme.

With thousands of buyers facing the same deadline and subsidy, a machine-tool maker with a full order book has little reason to cut prices. The logic points to part of the subsidy staying with the seller; nobody can yet say how much.

A rule with soft edges

The rates are a rule, and a rule can be priced. The edges are softer. Whether an activity is "industrial" turns on whether machinery plays the "predominant" role, which is a judgement. Regulations "will specify the technologies" covered. And the assessment says the text "will have to be updated" once the EU's revised state-aid rules are published, under which an operation that merely upgrades existing machines or replaces one machine with another "cannot be supported".

So a firm ordering today orders under a list the government says will change, in a direction it has announced, at a date it does not control.

That part cannot be sized, so do not guess at it. Raise the bar instead: a machine should pay its way without the deduction, which is then a bonus, not the reason to buy.

You can price a rule. You cannot price a discretion.

This is analysis, not legal, tax or investment advice. Check your own position with an adviser.

Accept the tax France already has, and ask one thing of it: treat every taxpayer the same.

Normal depreciation lets a firm deduct what a machine cost over its working life; that is simply how profit is measured. The suramortissement goes further. Outside the regional-aid zones, a small firm deducts €180 for every €100 it spends, and a medium-sized firm or an ETI €140. The extra is not a cost anyone bore. It is tax not paid on profit that was made.

Someone else pays it, now or later: the large company excluded outright, the shop that bought used, the service business with no production line, the manufacturer that ordered on 30 September. The government puts the bill at €161 million. That is a transfer from those who don't qualify to those who do. Choosing a tax rule over a grant doesn't change that; it only moves the payment from a budget line to a tax return.

The implementable version: one rule for every business. Every firm deducts what it actually spends on equipment, in full, in the year it spends it, new or used, whatever its size, with no end date. No more than it paid, and no less. No list, no calendar, no line at 50 staff.

The government's own words supply a test of intent. If small firms cannot finance investment from their own profits, the remedy is to tax less of what every firm earns, at one rate for all, whatever it buys. A deduction paid only for listed machines, bought new, inside a window, is not that remedy. It is a payment for buying what the state chose.

Equal treatment subsidises nobody. Each firm keeps what it earns on the same terms as its competitor, and chooses its own machine.

Stay free,

Jean-Pierre

The Austrian Actor

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