France Proposes New Crypto Tax on Stablecoin Swaps Set to Take Effect in 2027

France Moves to Tax Crypto Gains from Stablecoin Swaps by 2027

Paris, France — In a significant shift in its cryptocurrency tax policy, France’s National Assembly finance committee has approved a proposal that would impose a 31.4% tax on gains from swaps between cryptocurrencies and stablecoins, effective January 1, 2027. This move, which aims to regulate the burgeoning crypto market, still requires parliamentary approval before becoming law.

The proposed amendment, introduced by Nicolas Sansu and others as part of the 2027 budget, targets exchanges where investors convert cryptocurrencies into electronic money tokens governed by the European Union’s Markets in Crypto-Assets (MiCA) regulation. These tokens are designed to maintain a stable value against a fiat currency, making them an attractive option for investors.

Currently, taxes are only levied when cryptocurrencies are sold for fiat currency or used for purchases. However, the new proposal seeks to close a loophole that allows investors to defer taxes on gains realized during crypto-to-stablecoin conversions, even if the digital assets are never converted into traditional money.

What Changes Will the New Tax Bring?

The amendment, known as I-CF1826, will modify Article 150 VH bis of France’s tax law. It will establish a new method for calculating taxable gains, taking into account the sale value after deducting eligible fees. For cryptocurrencies purchased at varying prices, an average cost will be used to determine gains.

The 31.4% tax rate comprises a 12.8% income tax and an 18.6% social security contribution. Importantly, this tax will not apply to the total transaction value but rather to the realized gains after accounting for acquisition costs and related expenses.

Why Target Stablecoin Conversions?

The rationale behind focusing on stablecoin conversions is to ensure that profits from these transactions are taxed similarly to those from fiat currency sales. The proposal specifically targets electronic money tokens defined under MiCA legislation, excluding other forms of crypto assets from this taxation.

Additionally, the amendment includes provisions for taxpayers who own assets before 2027, allowing them to use recorded purchase costs or allocate costs across their entire portfolio as of December 31, 2026.

Other Proposed Tax Changes

In addition to the stablecoin tax, other amendments under review include:

• Exit Tax: An “exit tax” on unrealized crypto gains for residents moving abroad with significant crypto holdings, applicable to those who have lived in France for at least six of the past ten years and possess portfolios exceeding €800,000.

• Disclosure Requirements: A mandate for individuals to disclose self-held wallets containing cryptocurrency valued at €100,000 or more at year-end, with penalties of up to €10,000 for non-compliance.

• Loss Treatment: A proposal to treat crypto losses as securities, allowing them to offset gains on digital assets over the next ten years, rather than just within the same tax year.

While the finance committee’s approval is a step forward, the proposed budget and its amendments will undergo further discussions in Parliament before final adoption.

As France navigates the complexities of cryptocurrency taxation, investors and stakeholders will be closely watching how these changes unfold in the coming years.