Member of the French National Assembly Pierre Person introduced amendments to the draft “Law on Finance 2022” to simplify the process of access to cryptoassets and increase the investment attractiveness of France.
In 2019, France introduced a new tax regime for cryptoassets, which defines the concept of professional activity when extracting income from exchange transactions with cryptocurrencies and the procedure for placing cryptocurrency derivatives. Due to the high volatility of cryptoassets, taxpayers fear that their transactions may be reclassified as a professional activity by the tax authorities due to significant capital gains. In case of retraining, income tax may increase from 19% up to a maximum of 70%.
Today I tabled a series of amendments aimed at improving the tax regime for crypto-assets.
Their adoption would simplify the life of crypto-asset holders and strengthen the attractiveness of this sector in France. https://t.co/d7S1vXWHYg
– Pierre PERSON (@Pierr_Person) September 30, 2021
Pierre Person proposes for tax purposes to classify the use of advanced access to financial information and trading tools for managing digital assets (that is, exchange and brokerage activities) as a professional activity, and in other cases consider it unprofessional.
Further, the deputy asks for an amendment to allow the transfer of net capital losses to net income from the sale of digital assets within 10 years after their recognition. According to the current legislation, this rule applies only to the results of the current financial period.
Since every use of cryptoassets in financial and economic activities, regardless of the transaction (exchange or payment), leads to a tax event, Person recommends setting the initial tax threshold at € 3,000.
To increase the attractiveness of investing in cryptocurrencies and create a favorable tax climate for the creation of cryptocurrency companies in France, the deputy proposed to exempt cryptocurrency exchanges and exchangers from taxation, as well as to withdraw from the taxable base operations of legal entities to reinvest cryptoassets in the country’s economy and place digital assets in the interests of employees.
Earlier, the Bank of France and the National Bank of Switzerland announced the launch of an experimental project, Project Jura, to test government cryptocurrencies for international payments.
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