France has proposed extending its 31.4% cryptocurrency capital gains tax to regulated stablecoin conversions beginning January 2027. The French National Assembly's finance committee approved the amendment during discussions on October 7, though the measure still requires full parliamentary approval.
Under the proposal, capital gains tax would apply when investors convert Bitcoin or other cryptocurrencies into stablecoins classified as electronic money tokens under the EU's Markets in Crypto-Assets (MiCA) framework. Currently, French investors pay capital gains tax when selling cryptocurrencies for fiat money or purchasing goods, but cryptocurrency transfers typically remain untaxed until a taxable event occurs.
The finance committee passed the government's budget revenue for 2027 by a vote of 31 to three. Lawmakers are scheduled to vote on the revenue portion of the full budget on October 20. If Parliament approves the legislation, the tax would take effect on January 1, 2027.
Chainalysis' head of French operations warned that taxing regulated stablecoin conversions could push traders toward less regulated alternatives, including decentralized finance platforms and self-custody wallets.
Additional Tax Measures Under Consideration
France is also considering several related cryptocurrency tax changes. Lawmakers have backed a proposal requiring mandatory reporting for self-custody crypto wallets holding at least €100,000, with fines up to €10,000 for non-compliance.
The committee also approved raising France's exit tax on crypto holdings to roughly $900,000 from current levels. The exit tax applies to investment gains for taxpayers relocating their tax residence to another country.
Additionally, lawmakers approved an amendment allowing investors to deduct crypto losses over a 10-year period, subject to parliamentary approval.
