Lawmakers in France narrowly approved an amendment that could subject large cryptocurrency holdings to a new wealth tax, classifying them as “unproductive assets.”
The amendments brought forward by centrist lawmaker Jean-Paul Matteï on October 22 were passed late Friday in the lower house of the French Parliament with a close vote of 163 in favor and 150 against.
Matteï received backing from both socialist and far-right members to add a new clause dubbed Article 977 to France’s tax code, which introduces a tax on “unproductive wealth.” However, it still must pass through the Senate and be included in the final 2026 budget before it becomes law.
Under the amendment, the levy would be set at a flat rate of 1%, applied to the portion of net taxable assets exceeding €2 million. The measure also comes with an additional excise tax on tobacco products to supposedly balance the projected loss in government revenue,
If enacted, it would replace the country’s current real estate wealth tax framework, Impôt sur la Fortune Immobilière (IFI), with a broader system encompassing several other assets.
French lawmakers are reforming a decades-old wealth tax law for crypto
France abolished its previous general wealth tax in 2018, replacing it with the IFI, which applies only to real estate not tied to professional activity. Matteï told the National Assembly that this legislation is “economically inconsistent,” excluding from taxation several forms of “idle wealth” like gold, art, and digital assets, while penalizing property that contributes to the economy.
“The reform removes productive real estate from the base, properties rented for more than one year and meeting environmental standards, while integrating unproductive assets: non-productive real estate, tangible movable property like gold, cars, yachts, digital assets, and life insurance funds not allocated to productive investment,” the amendment’s explanatory note read.
The reaction from the French crypto community has been strongly negative, with naysayers like Éric Larchevêque, co-founder of hardware wallet maker Ledger, saying it “punishes all savers who wish to financially anchor themselves to gold and Bitcoin in order to protect their future.”
Writing about his sentiments on X last Saturday, Larchevêque told individuals holding substantial amounts of digital assets they might be forced to sell their crypto holdings to meet tax obligations if they lack other liquid assets.
He also cautioned that while the initial threshold is set at €2 million, lawmakers could later lower it, which could negatively impact investors within France’s borders.
“Crypto is equated with an unproductive reserve, not useful to the real economy. This is a major ideological error, punishing the holding of value outside the fiat monetary system,” Larchevêque concluded.
According to Cyrille Briere, a decentralized finance entrepreneur and consultant for Lagoon Finance, the law only affects crypto holdings, as the government has exempted stocks.
“France recently voted a 1% yearly capital tax on unproductive assets when their worth exceeds €1.3 million. Yes, you read correctly: capital, not profit. That asset class includes cryptos but excludes stocks,” he wrote on X Sunday evening, responding to Larchevêque’s opinionated post.
Briere stated that the measure might discourage investment and innovation and challenged lawmakers’ motives for safeguarding traditional financial instruments while going after Bitcoin holders.
“If you don’t want your cryptos stolen either by kidnappers or the state,” he added sarcastically, “just ask your old pal Larry Fink to convert them to stocks.”
France looking to accumulate BTC amid taxation queries
French lawmakers are pushing to tax “unproductive crypto wealth” just a week after pro-crypto proponents tabled a bill proposing to accumulate up to 2% of Bitcoin’s fixed supply in a national strategic reserve, similar to the plans of the current US administration.
As reported by Cryptopolitan, the proposal championed by Eric Ciotti, the president of the center-right Union of the Right (UDR), could make France the first European country to formally establish a Bitcoin treasury.
Alexander Laizet, Director of Bitcoin Strategy at The Blockchain Group, explained that the initiative could acquire approximately 420,000 BTC over a period of seven to eight years through nuclear and hydroelectric-powered mining, combined with perpetual holding of the coins.
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Source: https://www.cryptopolitan.com/france-vote-tax-crypto-unproductive-wealth/
