France stablecoin tax proposal would end existing exemption
Under amendment I-CF1826, submitted by lawmaker Nicolas Sansu, conversions from cryptocurrencies into qualifying electronic money tokens would become taxable transactions beginning January 1, 2027.
Current French tax rules generally allow individuals to exchange one cryptocurrency for another without immediately recognizing a taxable capital gain, provided the transaction falls within the applicable deferral provisions.
Converting Bitcoin or Ethereum into a qualifying stablecoin can receive the same treatment, even when the token is pegged to a traditional currency such as the US dollar or euro.
Sansu’s proposal would remove the exemption for exchanges in which investors receive electronic money tokens as defined under the European Union’s Markets in Crypto-Assets Regulation.
The amendment’s explanatory statement argued that existing rules allow investors to convert appreciated cryptocurrencies into fiat-backed stablecoins without triggering the tax that would apply if they sold the same assets directly for traditional currency.
It noted that stablecoins can be used for payments and purchases of other cryptocurrencies, despite their treatment as digital assets under the existing tax framework.
The proposal would require gains or losses from covered transactions to be calculated using the difference between the disposal value and the acquisition cost of the assets sold.
Documented transaction expenses could be deducted when determining the disposal value.
For cryptocurrencies purchased before January 1, 2027, investors would have two options for determining their acquisition costs.
They could use documented purchase prices for individual assets or allocate the portfolio’s total acquisition cost as of December 31, 2026, among the assets held on that date based on their respective values.
Taxpayers choosing the portfolio allocation method would make an irrevocable election when filing their first tax return covering a taxable disposal after the proposed implementation date.
The Finance Committee adopted the amendment on October 7. However, the measure has not received final parliamentary approval, and the proposed January implementation date remains subject to the legislative process.
Crypto loss deductions could be carried forward for 10 years
Alongside the stablecoin proposal, the Finance Committee approved amendment I-CF798, submitted by Daniel Labaronne, to change the treatment of losses from cryptocurrency transactions.
The amendment would allow qualifying capital losses from digital asset disposals to be carried forward for 10 years and offset against eligible gains realized during that period.
Under the existing framework, losses on qualifying private crypto disposals generally offset gains arising during the same tax year, with unused losses not available for deduction against gains in subsequent years.
Labaronne’s proposal would give investors a longer period to use those losses when calculating taxable cryptocurrency profits.
For example, an investor who records an eligible loss in one tax year but has insufficient gains to offset it could potentially apply the unused amount against qualifying gains in later years, subject to the final legislation.
The amendment concerns tax deductions for realized losses. It does not provide direct compensation for investors whose cryptocurrency holdings lose value.
French lawmakers have been considering changes to crypto taxation as authorities prepare to receive more detailed transaction information from exchanges and other service providers.
In September, crypto.news reported on France’s crypto tax activity after Chainalysis estimated that the country generated $9.4 billion in potentially taxable digital asset activity during 2025.
The estimate included $1.7 billion in crypto income, $2.5 billion in realized gains and $5.2 billion in payments across the six blockchains examined.
Chainalysis cautioned that the figures represented potentially taxable activity, not unpaid taxes or government revenue.
French taxpayers had reported €368 million in cryptocurrency capital gains for 2024 through approximately 24,000 tax filings, although the declared amount covered a different period and narrower category of transactions.
France weighs crypto exit tax for wealthy holders
Another proposal considered during the budget review would introduce an exit tax covering certain cryptocurrency holdings when taxpayers move their tax residence abroad.
The Finance Committee adopted amendment I-CF1822, submitted by Nicolas Sansu, on October 8.
The proposal targets unrealized gains associated with qualifying crypto holdings exceeding €800,000, subject to the conditions specified in the amendment.
France already operates an exit tax framework covering certain financial assets when eligible taxpayers relocate their tax residence outside the country.
The proposed amendment seeks to bring qualifying cryptocurrency holdings within the relevant tax treatment.
Unlike a conventional sale, which involves disposing of an asset, the proposed exit tax would concern unrealized gains when the applicable residence and asset conditions are met.
The committee’s approval does not mean the levy has taken effect. Its final scope and application would depend on the legislation adopted by parliament.
Meanwhile, France has been implementing new cryptocurrency reporting requirements under the European Union’s DAC8 directive.
The rules took effect across the bloc on January 1, 2026, requiring covered crypto service providers to collect customer identification details and transaction information for reporting to tax authorities.
The EU’s DAC8 reporting framework covers exchanges between cryptocurrencies and fiat currencies, crypto-to-crypto transactions and certain transfers involving external wallet addresses.
Information collected by reporting providers can include customer names, tax identification numbers, tax residences and details of qualifying transactions.
Under the reporting timetable, information covering the 2026 calendar year is scheduled for exchange between participating tax authorities in 2027.
The directive establishes reporting obligations for service providers and does not, by itself, make every reported cryptocurrency transfer a taxable event.
France’s crypto tax reporting rules face legal challenge
France’s implementation of DAC8 has faced opposition from cryptocurrency businesses concerned about the collection and storage of customer information.
On September 17, France’s Council of State rejected an emergency challenge brought by Bull Bitcoin and Paymium against the French decree implementing the reporting rules.
The companies sought to suspend the decree while pursuing a separate legal challenge seeking its annulment.
Bull Bitcoin argued that collecting and centralizing detailed information about cryptocurrency users could expose customers to security risks, particularly given incidents involving criminals targeting digital asset holders.
The Council of State rejected the emergency suspension request after finding that the required urgency had not been established.
The decision did not resolve the separate proceedings challenging the decree itself, which remained pending at the time.
France’s tax reporting obligations are part of the EU framework, although national governments retain responsibility for implementing the directive and enforcing applicable requirements.
Other European countries have been clarifying how their domestic reporting obligations apply to cryptocurrency holdings.
In September, Spain’s tax authorities confirmed the treatment of self-custody wallets under Form 721, stating that assets held in wallets controlled directly by taxpayers do not fall within the foreign custody reporting requirement.
The Spanish guidance distinguished wallets controlled by their owners from cryptocurrency held through foreign third-party custodians.
Transactions involving self-custody wallets can still generate reporting records under DAC8 when they pass through a covered service provider.
For France, the Finance Committee’s latest crypto tax amendments remain part of the 2027 budget deliberations, with further parliamentary consideration required before the proposed provisions can enter into force.