LOM law and fleet greening: your obligations in 2026

Since 2022 the LOM law required fleets of more than 100 light vehicles to include low-emission vehicles at each renewal. Since 1 March 2025, for companies, that quota has been replaced by an annual incentive tax: €4,000 in 2026, €5,000 from 2027 per missing vehicle.

Fleet greening is no longer an intention: it is a line in the income statement. In 2026, two schemes look alike but do not work the same way: the quotas of the mobility orientation law, codified in articles L. 224-7 to L. 224-12 of the French environment code, and the annual incentive tax created by the 2025 finance act. This article sets out what still applies, what has changed, and what needs to be put in place.

What is the LOM law and what does it say about company fleets?

Law no. 2019-1428 of 24 December 2019 on mobility orientation is the founding text of fleet transition in France. Its article 77 introduced into the environment code an obligation to progressively incorporate low-emission vehicles when fleets are renewed.

Three categories of actor were originally covered, each by a separate article:

• the State and its public bodies (article L. 224-7);

• local authorities and their groupings (article L. 224-8);

• private companies managing, directly or indirectly, a fleet of more than 100 vehicles with a gross vehicle weight of 3.5 tonnes or less (article L. 224-10).

The principle is simple: each time a company renews part of its fleet, a minimum share of the vehicles bought or leased long-term must be "low-emission". The obligation applies to the flow — incoming vehicles — not to the stock.

Law no. 2021-1104 of 22 August 2021, known as the Climate and Resilience law, subsequently raised the 2027 and 2030 thresholds for companies, from 35% to 40% and from 50% to 70%.

What low-emission vehicle quotas does the LOM law set?

For companies' passenger cars and light commercial vehicles, the trajectory written into article L. 224-10 of the environment code, as worded before the 2025 finance act, was as follows:

Date of application	Minimum share of renewals	Originating text
1 January 2022	10%	LOM law (2019)
1 January 2024	20%	LOM law (2019)
1 January 2027	40%	Climate and Resilience law (2021)
1 January 2030	70%	Climate and Resilience law (2021)

Source: article L. 224-10 of the environment code and the Greening of the vehicle fleet page of the French Ministry for Ecological Transition.

Since the 2025 finance act, these thresholds only apply to companies that manage more than one hundred mopeds and light motorcycles. The State, local authorities, taxi and ride-hailing booking centers and delivery platforms are subject to separate obligations, with their own rates (articles L. 224-7, L. 224-8 and L. 224-11 et seq. of the environment code). For private companies with more than 100 passenger cars and light commercial vehicles, the next section changes everything.

What changed in 2025: quotas replaced by a tax

This is the point most often misunderstood. The 2025 finance act removed the incorporation obligation of article L. 224-10 for companies managing more than 100 passenger cars and light commercial vehicles, and replaced it with a fiscal mechanism: the annual incentive tax on the acquisition of low-emission light vehicles.

In practice:

• Before 1 March 2025, a company that missed the 20% quota faced a legal obligation with no direct financial penalty — which explains the low compliance rate observed.

• Since 1 March 2025, the same company calculates each year the gap between its actual share of low-emission vehicles and a target, and pays a tax proportionate to that gap.

The logic remains that of the LOM law — greening the renewal flow — but the lever is now fiscal, declarative and quantified. The scheme is codified in the code of taxes on goods and services, articles L. 421-132-1 to L. 421-132-6, and commented on in the BOFiP, BOI-AIS-MOB-10-30-40.

How does the annual incentive tax work?

Who is liable?

Companies subject to VAT that use, for economic purposes in France, a fleet of at least 100 light vehicles on average over the year. Passenger vehicles (category M1) and certain category N1 vehicles are counted, whether owned or on a long-term lease. Unlike the LOM law, the threshold is assessed entity by entity, with no consolidation at group level.

What are the targets and rates, year by year?

Year	Target incorporation rate	Rate per missing vehicle
2025 (from 1 March)	15%	€2,000
2026	18%	€4,000
2027	25%	€5,000
2028	30%	€5,000
2029	35%	€5,000
2030	48%	€5,000

Source: articles L. 421-132-3 and L. 421-132-4 of the CIBS.

How is the amount calculated?

Tax = annual rate × gap to the target × annual renewal rate of high-emission light vehicles

The renewal rate compares the non-eligible vehicles that entered the fleet during the year with the total fleet. Only vehicles that joined the fleet no earlier than the third preceding calendar year count towards the share of low-emission vehicles.

Two cases where the tax is zero: a company that brings no high-emission vehicle into its fleet during the year pays nothing, and neither does a company that reaches or exceeds its target.

Indicative example for 2026, with allocation periods simplified to a full year: a company with 150 vehicles brought 80 into its fleet between 2023 and 2026, six of them electric cars in total. This year it brought in 30, three of them electric, so 27 high-emission vehicles. The 18% target applies to the 80 vehicles brought in, i.e. 14.4 vehicles; 8.4 are missing. The renewal rate is 27 ÷ 150 = 0.18. Amount: €4,000 × 8.4 × 0.18 ≈ €6,048. Use the official calculation sheet before filing.

Which vehicles count, and with what coefficient?

A low-emission vehicle under this scheme emits no more than 50 g of CO2 per km (WLTP) and meets pollutant thresholds below 80% of the regulatory limits. Electric and hydrogen vehicles qualify; plug-in hybrids qualify subject to their emissions figure, as shown in box V.7 of the registration document.

Uplift coefficients reward certain vehicles: +50% for a low-carbon-footprint vehicle, +100% for a low-emission van or special-purpose passenger vehicle, +150% where both criteria are met. A low-carbon-footprint electric van therefore counts as 2.5 vehicles.

What reporting obligations apply in 2026?

Obligation	Who	When
Filing and paying the incentive tax	Companies with 100 light vehicles or more	In January of the following year, with the VAT return, using calculation sheet no. 2854-FC-SD
LOM reporting (article L. 224-12)	Leasing companies, taxi and ride-hailing centers, delivery platforms, public bodies	Before 30 September of the following year; results published as open data on data.gouv.fr

LOM reporting makes public the data identifying the company and the percentage achieved. For private companies with more than 100 light vehicles, the ministry states that they remained required to report for 2024; for 2025 onwards, their declaration goes through the incentive tax.

Worth noting: failure to file is treated as an ordinary tax default, with late-payment interest and penalties. There is no longer a gray area as under the original regime.

Will the scheme change again?

The 2026 finance act adjusted the scheme from 1 March 2026, without touching the targets or the rates: it extended the scope of counted vehicles to M1 vehicles reversibly adapted for commercial use and to vehicles classified N2 solely because of the added mass of their battery, and clarified the calculation of the gap to target. On 25 February 2026, the BOFiP published, for public consultation, its commentary on the tax as created by the 2025 finance act; the adjustments made by the 2026 finance act are not yet included.

In practice, treat the trajectory above as a floor, and expect the eligibility criteria to tighten.

How to prepare your fleet without degrading the TCO

1. Know your fleet vehicle by vehicle. Category, energy, WLTP emissions, entry date, contract end. Without that base, calculating the tax is impossible. See vehicle and document tracking.

2. Model the total cost of ownership by use case. An urban van that returns to the depot every evening is an obvious electric candidate; a long-distance vehicle with no charging point at the driver's home is not yet. The TCO calculator compares scenarios over the life of the contract.

3. Prioritize the renewals that weigh most in the formula: a vehicle eligible for a +100% or +150% coefficient closes the gap two to three times faster than a city car.

4. Manage drivers and energy. An electrified fleet without charging tracking or eco-driving loses part of its economic advantage.

On related taxation, consider also the benefit in kind on electric vehicles, the environmental penalty and the annual taxes on the use of vehicles: all four pull in the same direction.

How Dadycar helps

Dadycar centralizes the data your compliance depends on: category, energy, CO2 emissions, entry and exit dates for each vehicle, lease contracts and renewal deadlines. The energy transition module identifies which vehicles to electrify first based on their real use. Custom reports produce the fleet statement needed for the declaration. Data is hosted in France.

Frequently asked questions

Does the LOM law still apply to companies in 2026?

Yes in principle, no in its original mechanism. The quotas of article L. 224-10 were removed for companies with more than 100 cars and light commercial vehicles by the 2025 finance act. They have been replaced since 1 March 2025 by the annual incentive tax.

What fleet threshold is concerned?

One hundred light vehicles. Under the LOM obligation, before 2025, more than 100 vehicles with a gross weight of 3.5 tonnes or less. Under the incentive tax, at least 100 passenger vehicles and certain N1 vehicles used for economic purposes, assessed as an annual average and entity by entity.

How much does the tax cost in 2026?

Four thousand euros per missing low-emission vehicle, against €2,000 in 2025 and €5,000 from 2027. That rate is multiplied by the gap to the target — 18% in 2026 — and by the renewal rate of high-emission vehicles. A fleet that renewed no vehicle pays nothing.

What is a low-emission vehicle under the law?

A vehicle whose CO2 emissions do not exceed 50 g/km on the WLTP cycle and whose pollutant emissions stay below 80% of the regulatory limits. Fully electric and hydrogen vehicles are described as "very low-emission".

Where is fleet greening declared?

The tax is filed and paid in January of the following year with the VAT return, using calculation sheet 2854-FC-SD on impots.gouv.fr. LOM reporting by leasing companies, booking centers and platforms is done before 30 September with the ministry, with publication on data.gouv.fr.

Do plug-in hybrids count?

Yes, if their WLTP CO2 figure — box V.7 of the registration document — is 50 g/km or less, and without an uplift coefficient. Fully electric vehicles qualify with no emissions condition and can benefit from the uplifts.