CHAPTER V : Value added tax compensation fund

Resources intended for the Fonds de compensation pour la taxe sur la valeur ajoutée, referred to in Article L. 1615-1, are distributed among the regions, départements, communes, the Lyon metropolitan area, their groupings, their régies, departmental and territorial fire and rescue services, communal social action centres, school funds, the Centre national de la fonction publique territoriale and the centres de gestion des personnels de la fonction publique territoriale in proportion to their eligible expenditure pursuant to Article L. 1615-1.

Establissements publics de coopération intercommunale and syndicats mixtes composed exclusively of members eligible for the Fonds de compensation pour la taxe sur la valeur ajoutée benefit, in place of their owner members, from allocations from the Fonds de compensation pour la taxe sur la valeur ajoutée in respect of eligible expenditure pursuant to article L. 1615-1 incurred in the exercise of their powers.

The departmental and territorial fire and rescue services benefit, in place of the municipalities, inter-municipal public establishments or departments that own them, from allocations from the Value Added Tax Compensation Fund in respect of expenditure incurred in the exercise of their powers on the assets referred to in Article L. 1424-17.

By way of derogation, local authorities and their groupings benefit from allocations from the Value Added Tax Compensation Fund in respect of investment expenditure incurred on property that they do not own, provided that it concerns work to combat avalanches, landslides, floods, fires, as well as work to defend against the sea and work to prevent forest fires, which is of general interest or urgent in nature. With regard to work carried out on the State's public domain, only investment expenditure carried out by local authorities or their groupings that have signed an agreement with the State specifying in particular the equipment to be installed, the technical programme for the work and the financial commitments of the parties are eligible for allocations from the fund.

Territorial authorities and their groupings benefit, by way of derogation, from allocations from the Value Added Tax Compensation Fund in respect of assistance funds paid from 1st January 2005 to the State or to another territorial authority or to a public establishment for inter-communal cooperation with its own tax system for actual investment expenditure carried out up to the 2020 financial year that they carry out on their public road property. The amount of these assistance funds is deducted from the actual investment expenditure incurred up to the 2020 financial year taken into account when calculating the allocation of the Value Added Tax Compensation Fund of the territorial authority or public establishment for inter-municipal cooperation with its own tax status that carries out the work.

Territorial authorities and their groupings benefit, by way of derogation, from allocations from the Value Added Tax Compensation Fund in respect of assistance funds paid to the State for investment expenditure paid from 1 January 2021 that the latter carries out on its public road domain.

However, the fifth paragraph does not apply to assistance funds paid from 1 January 2005 by municipalities under agreements signed before 1 January 2005 and relating to operations under a road quality plan within State-region plan contracts.

Territorial authorities and their groupings, provided they are responsible for roads, benefit, by way of derogation, from allocations from the Fonds de compensation pour la taxe sur la valeur ajoutée (Value Added Tax Compensation Fund) for capital expenditure relating to work that they carry out on the public roads owned by the State or a territorial authority. Only capital expenditure carried out under an agreement with the State or the territorial authority that owns the property specifying the equipment to be carried out, the technical programme for the work and the financial commitments of the parties are eligible for allocations from the fund.

Territorial authorities and their groupings also benefit from allocations from the Value Added Tax Compensation Fund in respect of investment expenditure carried out on the State's public river estate, as part of the experiment provided for in article L. 3113-2 of the general code of public property. Only investment expenditure carried out by local authorities or their groupings that have signed an agreement with the State is eligible for allocations from the fund.

Local authorities and their groupings are also eligible for allocations from the Value Added Tax Compensation Fund in respect of investment expenditure carried out from 1st January 2005 on buildings in the domain of the Conservatoire de l'espace littoral et des rivages lacustres. Only capital expenditure carried out by local authorities or their groupings that have signed an agreement with the Conservatoire de l'espace littoral et des rivages lacustres, specifying in particular the facilities to be built, the technical programme of works and the financial commitments of the parties, are eligible for allocations from the fund.

Local authorities and their groupings also benefit from allocations from the Fonds de compensation pour la taxe sur la valeur ajoutée in respect of equipment subsidies paid to the public establishment "Société du Canal Seine-Nord Europe" for the capital expenditure that the latter is making to build the river infrastructure linking the Seine and Oise basins to the European wide-gauge network, in accordance with the article 1 of order no. 2016-489 of 21 April 2016.