French lawmakers have narrowly approved a tax proposal that would make profits from cryptocurrency-to-stablecoin exchanges subject to the country’s 31.4% capital gains levy, potentially changing how digital asset investors manage their portfolios.
The French National Assembly passed amendment I-3898 to the 2027 budget on October 16, with 38 lawmakers voting in favor, 37 opposing it, and 25 abstaining. The decision moves the measure forward after it was previously endorsed by the assembly’s finance committee.
The proposed tax changes are scheduled to apply from January 1, 2027. However, the amendment must still clear the remaining stages of the parliamentary budget process and could be modified or dropped before becoming law.
Under current French tax rules, exchanges between cryptocurrencies generally qualify for deferred taxation when no additional cash payment is involved. Gains from private investments are normally taxed at 31.4%, although individuals can instead choose the progressive income-tax scale.
Amendment I-3898 would remove this tax deferral for electronic money tokens that fall within the European Union’s Markets in Crypto-Assets (MiCA) regulatory framework. This category includes qualifying stablecoins.
If the measure becomes law, investors could be required to pay tax on gains when converting crypto holdings into eligible stablecoins, even if they keep the proceeds within the digital asset market rather than converting them into fiat currency or transferring them to a bank account.
The proposal has sparked concerns about its potential consequences for crypto trading. Francois Volpoet, Chainalysis’ regional sales director for France, told CoinDesk last week that the change could encourage investors to use decentralized finance platforms, peer-to-peer transactions, and offshore exchanges that operate outside international tax-reporting arrangements.
Public Accounts Minister David Amiel questioned whether the proposed system could be implemented effectively and urged lawmakers to withdraw the amendment. He said he would oppose it if it remained in the legislation.
“We first need to define stablecoins, then ensure our ability to monitor and trace reallocations within a portfolio of assets,” Amiel said during the parliamentary debate.
Philippe Juvin, the finance committee’s rapporteur general, also argued in favor of retaining the existing tax deferral, pointing to the volatility of cryptocurrency markets.
The amendment would introduce another significant change to France’s capital gains framework. Rather than calculating gains across an investor’s overall portfolio, the revised approach would base taxable profits on the acquisition cost of the assets sold. For holdings of the same cryptocurrency purchased at different prices, the calculation would use a weighted-average acquisition cost.
