How does Tax Increment Financing function for urban redevelopment projects in France?

Hello and respectful greetings,

I reviewed your query regarding the use of Tax Increment Financing (TIF) for a redevelopment project in France.

It is important to clarify that France does not have a direct legal equivalent to the US/UK "TIF" legislation. You cannot strictly "freeze" a tax baseline and bond against 100% of the future increment in the same way. However, France uses alternative "Land Value Capture" mechanisms that achieve the same goal: financing public infrastructure through the value created by your private development.

To answer your specific technical questions for the French context:

How is the future increment defined?
Instead of a "tax increment," French law defines a "cost of public equipment." Under instruments like the PUP (Projet Urbain Partenarial), the "increment" is calculated based on the specific cost of infrastructure (roads, networks, schools) required by your project. You agree to pay this cost upfront or over time in exchange for building rights.

Which tax streams count?
>The primary stream is the Taxe d'Aménagement (Development Tax). In redevelopment zones, we can often negotiate an exemption from this tax in exchange for a direct contribution via a PUP convention. Alternatively, in a ZAC (Zone d'Aménagement Concerté), the "stream" is a participation fee based on your buildable floor area.

What legal steps are required?
Feasibility: Confirming if your site is in a ZAC or eligible for a PUP.
Negotiation: Drafting a convention with the local Mayor or Metropolis (EPCI).
Validation: The agreement must be voted on by the municipal council before your building permit is granted.

Navigating the Code de l'Urbanisme requires specific knowledge of these cross-border differences. I specialize in helping international investors structure these agreements in France.

Since I am currently handling international consultations remotely, I would be happy to guide you through the specific setup of a PUP or ZAC for your project via WhatsApp. This is a more cost-effective and agile way to get the initial legal structuring done before you commit to expensive local counsel.

Best regards,