Vive La France: Less Crypto-Currency Taxes for the French People
Do you remember Emmanuel Macron’s photo of holding a Ledger Blue (cold wallet)? Mr. Macron may be the first president to be aware of blockchain technologies and actively use them. Maybe he is the guy behind the new tax regime that is announced on April 26th: The French have to pay far less tax for their crypto-currencies now.
For years, cryptocurrencies were considered as “industrial and commercial profits” (BIC) in France and they were subject to a 45% income tax. This was the largest tax rate applied in France, and crypto-currency users have been struggling for years to change this tax regime. The State Council of France announced its decision on April 26th: the cryptocurrencies will now be considered as a “movable property” (BNC) and will be taxed accordingly. “Movable property”, in tax language, refers, unlike real estate, to property that can be moved: Cars, aircraft, jewelry, and even patents or copyrights. In case of a transfer, they are subject to a flat tax rate of 19%. That’s right: The French will now pay almost 100% less tax for Bitcoin and other cryptocurrencies.
However, If You Are a Miner…
The State Council changed the tax regime only for “trades”. This means if you buy crypto-currencies via exchanges and/or win them via online gambling, you can enjoy the new regime and pay fewer taxes. If you are a miner, however, the State Council identifies this activity as a “business” and says that it is still subject to the BIC tax regime, which means the tax rate is still 45% for miners. Moreover, this applies to all kinds of mining, even if it is a single operation.
Once more, online gamblers are covered by the new regime. So if you have won BTC from online gambling, you will be able to pay fewer taxes too.
It seems that France is very much interested in cryptocurrencies nowadays. In January 2018, Economy Minister Bruno Le Maire talked about creating a “digital currencies mission” and appointed Jean Pierre Landau, the former managing director of Bank of France, as the leader of this mission. Le Maire, who clearly aims to regulate the cryptocurrencies, seems to understand that he cannot do this just with strict laws. This tax cut is probably part of these regulatory schemes. However, lowering the taxes for crypto-currencies is always a good thing and worthy of a celebration. We congratulate the French and hope the other countries will take this practice as an example.