France’s Proposed Crypto Tax is “Economically Unjust”: Experts

France’s National Assembly adopted a controversial amendment to the estate tax that, for the first time, explicitly aimed cryptocurrency holdings, sparking criticism from industry experts who warn the measure could penalize innovation and drive talent abroad.

Amendment No. I-3379 to France’s Finance Bill 2026, past by a narrow 163-150 vote last Friday, it added digital assets under article L.54-10-1 of France’s Monetary and Financial Code to a new “unproductive wealth” tax base along with gold, yachts and classic cars.

The measure, presented by centrist deputy Jean-Paul Mattei of the Les Démocrates group, imposes a fixed annual tax of 1% on net wealth exceeding $2.2 million (€2 million), up from the previous limit of $1.49 million (€1.3 million).

While the project aims to encourage productive investment by exempting certain long-term rental properties, the crypto does not receive such a carve-out.

The amendment does not distinguish the categories of crypto holders and fails to exempt tokens obtained for commercial activities, team investment or network incentive programs.

Industry experts say the lack of nuanced definitions has complicated tax treatment for crypto founders and builders.

Joe David, CEO and Founder of Nephos, a professional services firm for the digital assets industry, said Decrypt the bill “risks oversimplifying” the crypto landscape by failing to distinguish between passive investors and ecosystem builders whose tokens represent “years of contribution, innovation and risk.”

He warned that the measure could “inadvertently penalize productive capital” driving technological progress in France’s digital economy and is not aligned with “global standards” on cryptographic taxation.

The latest proposal would lift its 30% sales-only crypto tax, replacing it with an annual wealth levy on holdings – taxing coins “whether they’re sold or not.”

Burçak Ünsal, Managing Partner of ÜNSAL Attorneys at Law, said Decrypt the amendment fails to carve out token issuers and founders who hold assets as part of their operational role.

Taxing early token holders could be “economically unfair,” he noted, when their role is to build the ecosystem, creating an “unintended disincentive” for long-term alignment.

Ünsal warned that without clear definitions distinguishing professional traders from casual traders, there remains a “tax structuring risk” for token-based business models.

The bill lacks clear definitions that distinguish occasional traders from professionals, Ünsal said, noting that the distinction “would be determined on a case-by-case basis” considering “volume, frequency and proportion of income crypto.” He warned that until “implementation or guidance decrees” clarify the rules, a “tax structuring risk” remains for token-based businesses.

Austin Yuanlun Yin, US licensed CPA and Chairman of the Global Crypto Taxation Council, said Decrypt the reform “risks punishing innovation” and that taxing crypto would greatly “accelerate capital flight” as investors can move digital assets across borders in minutes.

“By lumping digital assets like Bitcoin with yachts and art under a ‘tax on unproductive wealth,’ France is sending a message that the capital held in crypto is inactive rather than dynamic. That is inaccurate and short-sighted,” said Yin.

Instead of taxing cryptocurrencies as “unproductive,” policymakers should “recognize their role in financing startups, decentralized infrastructure, and digital innovation,” he added.

The bill is now headed to the Senate before a second reading in the National Assembly. Lawmakers have 70 days to complete deliberations, with final adoption required by December 31, 2025.