Summary:
French Senator Sylvie Vermeillet proposes taxing Bitcoin as an "unproductive asset".
Taxes would apply to unrealized gains exceeding €800,000.
Concerns raised by Alice Stork about taxing gains that haven't been cashed out.
Proposal endorsed by Finance Minister Laurent Saint-Martin.
Non-compliance could result in fines of €750 to €1,500.
Earlier this week, French Senator Sylvie Vermeillet proposed a controversial bill that aims to classify Bitcoin and other digital assets as "unproductive", suggesting that they should be taxed similarly to luxury items and vacant properties. The proposed legislation would impose taxes on unrealized gains exceeding €800,000 as part of the 2025 budget.
Paris-based Alice Stork, founder of the Web3 public relations agency ICL, expressed her concerns to Decrypt, stating that a tax on unrealized gains feels "out of touch" with the inherent volatility of crypto markets. She questioned the fairness of taxing gains that have not been cashed out, fearing that such measures could drive innovators and businesses away from France.
So far, the proposal has passed a preliminary vote in the Senate and has received endorsement from the country’s Finance Minister, Laurent Saint-Martin, who claims that this change will create a more balanced taxation system for Bitcoin gains.
If enacted, French cryptocurrency holders will be required to report their foreign cryptocurrency holdings annually using the Cerfa 3916-bis form. Fines for non-compliance could range from €750 to €1,500.
SĂ©bastien Martin, CEO of the French crypto risk management firm RAID Square, noted the political weight of Vermeillet, being a vice president of the Senate and a member of the Parti Radical, which supports President Emmanuel Macron's policies.
This move by France follows a series of regulatory efforts concerning cryptocurrencies. Recent reports have indicated that France's National Gaming Authority is considering blocking Polymarket, a blockchain-based prediction market platform, due to compliance issues. Additionally, the exchange ByBit announced its exit from the French market due to evolving regulatory conditions stemming from the MiCA crypto legislation.
Moreover, France has faced criticism from privacy advocates following the arrest of Telegram founder Pavel Durov on multiple charges related to his platform. Critics have alleged that the arrest was politically motivated, a claim denied by President Macron.
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