French Committee Backs New Crypto Taxes, Budget Rejection Halts Immediate Progress

France's National Assembly Finance Committee has taken significant steps towards broadening the country's cryptocurrency tax framework, approving amendments this week that would introduce levies on stablecoin transactions and an exit tax for high-net-worth crypto holders. However, the immediate future of these proposals remains uncertain after the committee subsequently rejected the entire revenue section of the 2027 budget on Friday.

The committee's rejection means that the proposed crypto tax measures, while approved at the committee stage, will not automatically carry over to the government's original budget text for the full Assembly debate. Their backers will need to re-table these amendments for further consideration during the legislative process, which commences on October 13.

Expanding the Tax Net for Digital Assets

One of the key amendments, proposed by Nicolas Sansu of the left-wing GDR group and co-signers, targets what they describe as a "hole in the legislation" concerning stablecoin swaps. Currently, converting a cryptocurrency like Bitcoin into a stablecoin—a digital asset pegged to a fiat currency such as the euro or dollar—does not trigger a taxable event in France. Tax is only levied when gains are converted into traditional currency or spent.

Under the proposed change, effective January 1, 2027, swapping into MiCA-defined electronic money tokens, which include most single-currency stablecoins, would be considered a taxable sale. Gains would be calculated against the holder's original acquisition cost. The amendment does not specify a new tax rate, instead deferring to France's flat tax, which currently stands at 31.4% following an increase in social charges earlier this year. Proponents argue this merely applies existing law to a previously untaxed scenario, considering stablecoins as ordinary investment vehicles.

Another amendment from Sansu seeks to extend France's existing exit tax to cryptocurrency holdings. This levy applies to unrealized gains when a taxpayer moves their tax residence abroad. The proposal targets tax households with combined crypto assets, including those held through custodians, exceeding €800,000, provided the individual has been a French tax resident for at least six of the preceding ten years. This threshold aligns with the existing regime for shares, and payment deferral rules would also mirror those for stocks. Swaps between cryptocurrencies without a cash component would not be considered sales for exit tax purposes.

Authors of this amendment highlight the ease with which digital assets can be moved across borders and argue against the current disparity where directly held crypto escapes the exit tax, unlike shares of equivalent value. Taxpayers would be required to declare all crypto holdings, including self-custodied assets or those held abroad, at the time of their departure.

In a move that could benefit crypto investors, an amendment proposed by Daniel Labaronne also secured committee approval. This measure would allow investors to carry forward crypto losses for up to 10 years to offset future gains, aligning the treatment of digital assets with that of traditional stocks. Currently, unused crypto losses cannot be carried over.

Why it matters

These legislative efforts underscore a growing trend among European regulators to integrate digital assets more fully into traditional financial and tax frameworks. The proposed stablecoin tax aims to close a perceived loophole, ensuring that wealth accumulation in the crypto space is treated similarly to other asset classes, even if not immediately converted to fiat currency. The exit tax reflects concerns about capital flight and the portability of digital wealth, seeking to prevent high-net-worth individuals from avoiding taxes by relocating.

For investors, the ability to carry forward losses would be a significant positive development, offering greater parity with stock market investments and potentially incentivizing more mainstream participation in the crypto market. These discussions also build on previous legislative actions; in October 2025, the Assembly adopted a 1% annual levy on "unproductive" wealth above €2 million, which included digital assets alongside gold and yachts. Attorney Burçak Ünsal previously noted that taxing early token holders could be "economically unjust."

What to watch

All eyes will now be on the National Assembly as the floor debate on the budget's revenue section begins on October 13, with a formal vote scheduled for October 20. For the stablecoin and exit tax rules to be implemented by their proposed January 1, 2027, effective date, their proponents must successfully re-table them and navigate the full legislative process. The outcome will signal France's definitive stance on taxing digital assets and could influence similar discussions across the European Union, particularly given the EU's comprehensive MiCA crypto rulebook, which Coinbase noted in October 2024 would lead to delisting of non-compliant stablecoins for European customers by December 30.