French Bitcoin Tax Proposal Raises Concerns About Impact on Crypto Innovation

French Bitcoin Tax Proposal: Senator Sylvie Vermeillet Suggests Taxing Cryptocurrencies Like Luxury Goods in France

French Senator Sylvie Vermeillet suggested earlier this week that Bitcoin and other digital assets be categorized as unproductive, contending that they need to be subject to the same taxes as luxury goods and unoccupied real estate. According to the bill in question, cryptocurrencies will be taxed on unrealized profits exceeding €800,000 if they are classified as unproductive assets for the 2025 budget.

A Bitcoin tax on unrealized profits is worrying and feels pretty out of touch with how volatile crypto markets are, according to Alice Stork, founder of Web3 public relations firm ICL. She wondered what would happen if you had previously paid taxes on gains you never cashed out and the value of your possessions fell. Moreover, the proposal may drive innovators and businesses away from France, she said.

Laurent Saint-Martin Supports Bitcoin Tax Change, Aims for More Balanced System

Laurent Saint-Martin, the nation’s finance minister, has approved the proposal, which has so far cleared the Senate in a preliminary vote. According to the finance minister, the system is now more balanced as a result of the modification to the taxation on Bitcoin earnings. The Cerfa 3916-bis form would require French cryptocurrency holders to record their foreign cryptocurrency holdings on an annual basis if it were approved. There will be fines ranging from €750 to €1,500 for not disclosing cryptocurrency holdings overseas.

However, Sébastien Martin, the CEO and co-founder of the French crypto risk management company RAID Square, stated that Vermeillet is a powerful figure in French politics due to his position as Vice President of the Sénat, one of the two chambers of the French Parliament. He is also a member of France’s oldest political party, the Parti Radical, and part of the political parties supporting the policy led by the French Président, Emmanuel Macron, Martin continued.

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