France mulls 31.4% tax on EU-regulated stablecoins, offshore risk

French lawmakers are weighing a proposal to tax swaps from crypto into EU-regulated stablecoins at France's existing 31.4% capital gains rate starting Jan. 1, 2027.

As it stands, swapping one crypto for another generally doesn't trigger capital gains tax in France. The new amendment, adopted by the National Assembly's finance committee on Oct. 7, would change that for stablecoins classified as electronic money tokens under the EU's Markets in Crypto-Assets (MiCA) rules.

Why the warning

Chainalysis CEO for France, Francois Volpoet, told CoinDesk the measure could push traders toward less transparent, unregulated stablecoins. "Do we want more taxpayers to declare their assets, or a higher tax rate applied to a base that is increasingly evaded?" he said.

What else is in the pot

Another finance committee amendment from Oct. 9 would require taxpayers to declare self-hosted crypto wallets holding at least €100,000 ($116,000). Fines could reach $11,600. Volpoet flagged security risks, noting France accounted for 33 of 52 global physical attacks on crypto holders as of July.

Lawmakers also backed extending France's exit tax to crypto holdings worth roughly $900,000, while a separate amendment would allow crypto losses to be carried forward for up to 10 years.

The finance committee then rejected the revenue section 31-3, sending the crypto amendments back for debate. A full National Assembly vote on the revenue section is scheduled for Oct. 20. None of this is law yet.

The takeaway: France's tax proposal is still a proposal, but the threat of a 31.4% hit on regulated stablecoin swaps is enough to make traders think about offshore exits.