The French government is proposing to replace the real estate wealth tax with a “non-productive wealth tax” targeting dormant assets, including private equity, luxury goods, and other unused real estate. According to Senator Sylvie Vermeillet, Bitcoin will be classified as a non-productive asset in next year’s national budget. Vermeillet’s proposal is similar to taxing luxury goods and unused properties.
French tax laws apply a flat rate of 30% on cryptocurrency gains above €305. However, in the proposed tax law of 2025, even unrealized gains in crypto are subject to tax. Under Vermeillet’s proposal, goods in stock above €800,000 would be taxed.
Failure to report a foreign account is subject to €1,500 per account, but cryptocurrency-to-cryptocurrency trading is not taxed. The new tax proposal has already passed the first floor of the Senate, but the legislation is not yet final.
JUST SIGN IN: 🇫🇷 France will be taxed #Bitcoin large unrealized gains. pic.twitter.com/8zsehL05f4
– Bitcoin Archive (@BTC_Archive) December 3, 2024
French Government Wants ‘Rated Tax’
On December 3, French Senator Sylvie Vermeillet officially presented a proposal to classify Bitcoin and cryptocurrencies as non-productive assets in next year’s budget. Like unused real estate and luxury goods, non-productive assets such as Bitcoin and digital assets are subject to taxation. French
Finance Minister Laurent Saint-Martin approves the proposal, saying that exempting high-value digital assets from taxation while taxing other economic assets is wrong.
The proposal aims to balance taxation between digital and physical assets, creating a “balanced tax system.” Once approved, crypto owners and investors should reevaluate their holdings and future investments. However, the proposal has several critics who say it could reduce market interest and increase price volatility.
Total crypto market cap at $3.47 trillion on the daily chart: TradingView.com
No Tax on Crypto-To-Crypto Trades
French tax laws impose taxes on profits made from purchases in BTC or other digital assets and sales of Euro digital assets. Under the current proposal, there are no taxes on crypto-to-crypto transactions, allowing investors and owners to quickly divest their holdings of tax obligations. According to its proponents and supporters, the new tax law will benefit crypto trading and increase market participation.
Image: Nomad Offshore Academy
The amendment introduced on November 18 specifies the tax rates of the national budget for the next year, owners who pay taxes on goods of more than €800,000. Although the new law may seem simple, the reporting process can be difficult for some. Crypto holders must track transactions such as lending, staking, and liquidity pools.
Crypto Managers Must Report Or Face Fines
The submitted amendment also requires French taxpayers to report any crypto accounts outside the country. Failure to report is subject to a fine of €750. And if the account holds more than €50,000 in assets, the fine increases to €1,500.
Vermeillet’s proposal also requires owners to submit a Cerfa 3916-bis form annually for tax reporting purposes. Taxpayers must file their tax returns every year, even if no recorded transactions are involved. Authorities reserve the right to review individual tax records if the government suspects possible fraud.
Featured image from Alexander Spatari via Getty Imageschart from TradingView