France’s National Assembly has rejected the revenue section of its proposed 2027 budget, removing several cryptocurrency tax and reporting amendments from the version of the legislation heading to the Senate.
Summary
- France’s National Assembly rejected the revenue section of its proposed 2027 budget by 458 votes to none, removing several previously approved crypto tax amendments from the text heading to the Senate.
- Among the affected proposals were a tax on crypto to stablecoin conversions and a requirement for taxpayers to disclose self-custodied crypto holdings worth at least €100,000.
- Morpho’s global head of public affairs, Faustine Fleuret, raised concerns about the proposed tax changes and their potential impact on France’s attractiveness to crypto businesses.
- The Senate is scheduled to begin debating the finance bill on November 20, with the revenue section set for examination from November 23, when lawmakers could revisit the proposals.
The November 4 vote saw 458 lawmakers oppose the revenue section, with none voting in favour and two abstaining, according to the Assembly’s official voting record.
The rejection means the government’s original budget proposal will now proceed to the Senate without the amendments approved during the National Assembly’s debates. Among the affected measures are proposals to tax cryptocurrency conversions into stablecoins and require investors with large self-custodied holdings to disclose their assets.
The amendments could still return during the Senate’s examination of the budget, although they would need to secure parliamentary approval before becoming law.
The decision followed weeks of disagreements over the government’s financial proposals, with lawmakers introducing numerous changes to the original budget after debates began on October 13.
According to French parliamentary broadcaster LCP, the rejection prevents the National Assembly from proceeding to the expenditure section of the budget because the revenue provisions must first be approved.
France’s stablecoin tax and self-custody proposals dropped
One of the affected measures was an amendment adopted on October 16 that would have made certain cryptocurrency-to-stablecoin conversions taxable transactions from January 2027.
Under France’s existing framework, eligible exchanges between cryptocurrencies generally do not trigger an immediate capital gains tax unless the investor converts the assets into fiat currency or uses them in a taxable transaction.
The proposed amendment would have changed that treatment for conversions into stablecoins classified as electronic money tokens under the European Union’s Markets in Crypto-Assets regulation.
Investors converting Bitcoin or other cryptocurrencies into qualifying stablecoins could therefore have faced capital gains tax without withdrawing their funds into a traditional bank account.
The proposal had narrowly passed the Assembly by 38 votes to 37, with 25 abstentions, after receiving earlier support from the Finance Committee.
As previously reported by crypto.news, lawmakers had considered the stablecoin tax alongside another proposal that would allow eligible cryptocurrency trading losses to offset future gains for up to 10 years.
On November 3, lawmakers approved a self-custody reporting amendment by 150 votes to 44, with eight abstentions.
The proposal would have required taxpayers holding at least €100,000, approximately $112,000, in qualifying self-custodied crypto assets to report those holdings to French tax authorities.
The threshold would have been calculated using the total value of eligible assets on December 31 of the relevant tax year, with penalties of up to €10,000 for failing to comply.
The requirement concerned disclosure of holdings and did not itself introduce a new annual tax on the reported assets.
During the parliamentary debate, Public Action and Accounts Minister David Amiel questioned whether a self-reporting obligation would effectively identify taxpayers deliberately concealing cryptocurrency holdings.
Finance Committee general rapporteur Philippe Juvin supported the principle of disclosure but questioned the proposed thresholds, which included alternatives of €5,000 and €50,000 before lawmakers settled on €100,000.
A separate amendment would have raised penalties for cryptocurrency platforms failing to provide information requested by tax authorities from €10,000 to €50,000.
Industry concerns emerge as budget moves to Senate
In a LinkedIn post discussing the budget proposals, Faustine Fleuret, global head of public affairs at lending protocol Morpho, called for policymakers to consider how existing tax laws and regulations could keep pace with financial innovation.
“Finance is transforming faster than the law, taxation and sometimes even mindsets,” she wrote, adding that policymakers needed to anticipate technological developments and adjust public policies to benefit from economic growth, employment and technological independence.
Fleuret specifically identified taxes on crypto-to-stablecoin conversions, wallet disclosure requirements and exit taxes among the proposals that could affect France’s competitiveness.
She stressed the need to preserve self-custody and the technological foundations of decentralised finance when developing future regulations.
The budget debate had already seen lawmakers reject two proposals to extend France’s existing exit-tax framework to certain cryptocurrency holdings.
On October 30, the Assembly rejected an amendment introduced by lawmaker Nicolas Sansu that would have brought qualifying unrealised cryptocurrency gains under the country’s exit-tax rules when eligible taxpayers moved abroad.
The proposal received 27 votes in favour and 55 against, with one abstention.
Another amendment introduced by lawmaker Mickaël Bouloux would have targeted unrealised gains on household cryptocurrency holdings exceeding €800,000 when eligible investors transferred their tax residence outside France.
Lawmakers rejected that proposal by 60 votes to 31, according to earlier coverage of the exit-tax debate.
Meanwhile, the debate over cryptocurrency reporting comes as France prepares to exchange more transaction information under the European Union’s DAC8 tax transparency framework.
The directive requires covered cryptocurrency service providers to collect information about reportable transactions involving EU residents from January 2026, with the first exchanges between tax authorities scheduled for 2027.
Unlike the rejected self-custody amendment, DAC8 places reporting obligations on qualifying service providers and covers certain transfers involving wallets controlled directly by their owners.
The French government has faced legal challenges over its implementation of the framework, including an emergency application brought by Bull Bitcoin and Paymium that the Council of State rejected in September.
The applicants had raised concerns about the collection and storage of cryptocurrency users’ information, although the court’s emergency decision did not settle their separate challenge to the implementing decree.
The Senate is scheduled to begin debating the 2027 finance bill on November 20, with examination of the revenue section’s articles set to begin on November 23.
Following the Senate’s review, lawmakers from both chambers may attempt to reach an agreement on the legislation.
France’s wider budget process faces a constitutional deadline of December 17, while Prime Minister Sébastien Lecornu’s government retains the option of using Article 49.3 of the Constitution to advance the budget without a conventional parliamentary vote, subject to the possibility of a no-confidence motion.
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