The French National Assembly has adopted a new amendment which will see a flat tax rate of 30% applied to gains from Bitcoin and other crypto-based assets.
The measure has attracted luke-warm reception from France’s Bitcoin community. On the one hand, the initiative is being praised for its simplification of what has been a complicated fiscal landscape for Bitcoin holders up until now.
On the other hand, some critics point out that France remains at the upper end of the taxation spectrum for crypto-currencies in a European context.
Jusqu’à présent la fiscalité des gains tirés de la cession de crytpoactifs était dans le grand flou. Ce matin la commission des finances a adopté un de mes amendements visant à les soumettre au PFU à 30% pour plus de clarté #PLF2019 #FinancesAN
— Eric Woerth (@ericwoerth) November 7, 2018
Under the new arrangement which comes into effect on January 1 2019, Bitcoin will fall under France’s existing PFU (Prélèvement Forfaitaire Unique) fiscal regime – originally designed as a simplified tax framework with a flat rate of 30% for dividend payments, interest returns and capital gains from long-term investments.
Under the previous arrangement, crypto holdings of up to €5000 were exempt from any taxation, after which a variable rate could apply – averaging around 36% – depending on a myriad of factors which have been the source of major frustrations for some of France’s crypto community.
There is no change for tax residents who realise gains from active trading of or payments in Bitcoin and other crypto-currencies.