By Nick Hamilton | United States
Earlier this year, France and Germany came to a consensus that they needed to tax and regulate Bitcoin.
However, on April 26th, France turned over a new leaf. The nation cut taxes by more than half on the crypto-currency, from 45% to 19%, excluding other social taxes.
With this social contribution tax, France will tax Bitcoin at 34.5%, which is still almost a 25% tax cut.
This comes due to a change in the classification of cryptocurrency. France is now classifying Bitcoin as a capital gain, meaning that it get’s the flat tax of 19%, per French law.
At the G20 Summit in Buenos Aires last March, Germany and France both advocated heavily for regulation of the currency. The French Financial Minister, Bruno Le Maire, sent out a series of tweets on March 19th about regulating Bitcoin with other EU countries, which you can read here. However, clearly, Mr Le Maire has had a change of heart, and it definitely picked up a huge win in France yesterday.
Since the ruling yesterday, Bitcoin saw a jump to over $9k, and is maintaining that early this morning pretty nicely. The currency has been on an upwards trend lately. Thus, this tax cut could very well motivate more French to buy it, as France is one of the more economically stable states of the EU, with many citizens looking to invest in crypto-currency.
However, this is not the only means of relaxed taxation we’ve seen from the EU. Germany announced on March 1st, 2018 that they support crypto-currencies as a form of payment. This also means that the government will not tax miners that receive block rewards, due to their services being voluntary. So, even though both France and Germany have called for heavy regulation, they’ve been very lenient on taxation.