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ZEC $1,095 France proposes 31.4% tax on crypto-to-stablecoin swaps in 2027
French lawmakers approved a measure to tax gains from converting digital assets into stablecoins, pending October's full parliament vote.
Key takeaways
- Tax rate defined. The proposed rate is 31.4%, comprising 12.8% income tax and 18.6% social security contributions.
- Wallet reporting threshold. Self-custody wallets holding at least €100,000 would require mandatory reporting with penalties up to €10,000.
- Exit tax scope. The exit tax would apply to residents holding portfolios worth more than €800,000 who lived in France for at least six of the last ten years.
What happened
France's National Assembly finance committee approved a proposal on October 7 to extend the country's cryptocurrency capital gains tax to swaps between digital assets and stablecoins. Under the measure, converting Bitcoin or other crypto into regulated stablecoins would trigger a 31.4% tax beginning January 1, 2027, provided Parliament approves the legislation.
The tax would apply only to gains, not the full swap value, and would use an average cost method for assets purchased at different prices. The measure targets stablecoins classified as electronic money tokens under the EU's Markets in Crypto-Assets framework. Currently, crypto-to-crypto transfers are typically not taxable until investors convert to fiat currency.
The National Assembly finance committee passed the government's budget revenue by 31 votes to three. Lawmakers are scheduled to vote on the full revenue portion of the 2027 budget on October 20, when the stablecoin tax provision will face renewed parliamentary debate.
Why it matters
The proposal would close what French authorities view as a tax loophole allowing investors to move profits into stablecoins that function like cash without immediate taxation. Chainalysis' France operations head Francois Volpoet cautioned that banning conversions to regulated stablecoins could push traders toward less transparent options like decentralized finance platforms and self-custody wallets.
Beyond the stablecoin measure, France is advancing parallel crypto tax changes. Lawmakers approved mandatory reporting for self-custody wallets holding at least €100,000, with fines up to €10,000 for non-compliance. The country also plans to extend its exit tax to crypto holdings exceeding approximately €800,000 for residents relocating abroad, and will allow investors to deduct losses against gains over a ten-year period.
Questions readers ask
What stablecoins would be taxed under France's proposal?
The tax applies only to electronic money tokens regulated under the EU's Markets in Crypto-Assets framework, not all stablecoins or other crypto assets.
When would France's crypto-to-stablecoin tax take effect?
If Parliament approves the measure, the 31.4% tax would begin on January 1, 2027.
What are the self-custody wallet reporting requirements?
French lawmakers backed mandatory reporting for wallets holding at least €100,000, with penalties up to €10,000 for violations.
Does the tax apply to the entire swap amount?
No, the tax applies only to gains after subtracting purchase costs and eligible fees, calculated using an average cost method for assets bought at different prices.
