France Moves to Tax Stablecoin Swaps as 10-Year Crypto Loss Relief Advances
France's parliamentary committee has approved budget proposals to tax stablecoin swaps, introduce a 10-year crypto loss carryback relief, and enforce a crypto exit tax as part of the 2027 fiscal year draft.
French legislators have approved a legislative bill that would mandate taxation on specific cryptocurrency trades involving stablecoins, while also extending the carryback window for cryptocurrency investor capital losses to a decade. These proposed cryptocurrency trading laws form a segment of the draft budget proposal for the 2027 fiscal year and require additional legislative processes before taking effect.
On October 7, the National Assembly Finance Committee cleared a bill amendment concerning stablecoins. A separate legislative amendment would allow investors to apply past capital losses against future capital gains, in addition to deducting current-year capital losses.
France Targets Stablecoin Conversions Under 2027 Tax Plan
Tabled by Nicolas Sansu, Amendment I-CF1826 seeks to apply a tax starting January 1, 2027, to exchanges of traditional currency into electronic money tokens. Defined under documents like the EU Markets in Crypto-Assets Regulation, electronic money tokens encompass qualifying fiat-pegged stablecoins.
Capital gains tax exemptions currently apply to e-commerce transactions executed with cryptocurrencies. Such exemptions are also available when investors trade Bitcoin and Ethereum for euro- and U.S. dollar-pegged stablecoins.
Under the revised rule, the existing deferral for stablecoin transactions would be eliminated. Gains and losses resulting from stablecoin trades will typically be realized under the new framework, with taxation determined by the sale price and cost basis of the exchanged stablecoins, alongside specific fees paid for the exchange.
Read More: U.S. vs. Europe: Who Is Winning the Race to Regulate Crypto?
For assets acquired prior to 2027, taxpayers can choose to report individual purchase cost bases or pool purchased assets with those already held as of December 31, 2026, reporting a combined aggregate cost basis for all assets owned on that date. Once selected, this reporting method cannot be changed.
Crypto Loss Relief, Exit Tax and DAC8 Reporting
Put forward by Daniel Labaronne, another committee-endorsed proposal—I-CF798—would enable taxpayers to offset digital asset gains with losses incurred over a period of up to 10 years. Presently, taxpayers may only use current-year losses to offset digital asset gains realized within the same year. This measure aims to reduce digital asset tax burdens without offsetting their depreciation in value.
Measures designed to partially circumvent the Sansu I-CF1822 proposal gained approval on October 8. This proposal from Sansu mandates that specific virtual currency holders who emigrate abroad must settle an exit tax if their portfolio exceeds €800,000 in value. This emigration tax is anticipated to take effect.
Furthermore, the European Union’s DAC8 regulations mandate that covered entities report on crypto service users and transactions beginning in 2026, with cross-border tax information sharing among EU nations scheduled for 2027. Compliance with these reporting mandates does not classify individual crypto transfers as taxable occurrences.
French firms Paymium and Bull Bitcoin contested the national reporting mandate. On September 17, the Council of State dismissed an appeal seeking emergency relief while keeping its decision pending regarding the broader appeal to invalidate the national rule.
Read More: What MiCA Still Doesn’t Solve — Europe’s Biggest Crypto Regulation Problems
France documented $368 million in cryptocurrency capital gains across approximately 24,000 taxpayer returns for 2024. Meanwhile, Chainalysis estimated $9.4 billion in cryptocurrency transaction taxes for France in 2025, noting that this figure does not account for unpaid tax liabilities.
All three budget proposals remain committee-level recommendations that have not yet been formally enacted, representing new taxes currently undergoing active debate.
