French National Assembly Backs 31.4% Tax on Crypto-to-Stablecoin Swaps

The 38-37 Vote on Amendment I-3898

France's National Assembly approved amendment I-3898 on Friday, October 16, a measure that would tax gains realized when investors convert digital assets into stablecoins, by a margin of 38 votes to 37 with 25 abstentions. The proposal, introduced by left-wing lawmaker Nicolas Sansu, ends a long-standing deferral: under current rules, French investors pay no tax when swapping one crypto asset for another, and the liability falls due only when profits are converted into euros or withdrawn in cash. The amendment breaks that deferral in one specific case, conversions into stablecoins classified as electronic money tokens (EMT) under the EU's MiCA framework. From that moment, a gain becomes taxable even if the investor never cashed out. The 31.4% rate matches the flat tax France already applies to private capital gains, per the tax authority's guidance on declaring digital-asset gains. A worked example shows the effect: an investor who bought Bitcoin for €10,000 and saw the position reach €20,000 would owe €3,140 on the €10,000 gain at the moment of the swap. Gains would be measured against purchase cost, using a weighted average where the same asset was bought at different prices.

Riots Complicate the Budget Debate

Lawmakers weighed the tax change while France contended with some of its most severe unrest in years. Over the past week, hundreds of thousands of people marched across the country in cost-of-living protests that began with students demanding more teachers and better school conditions, then widened into anger over wages, public services and household bills. Several demonstrations turned violent, with fires and looting reported in multiple cities, and more than 2,500 people were taken into custody after the weekend riots, according to Reuters. The two developments point to the same fiscal squeeze. The government aims to cut the deficit from 5.4% of GDP this year to 5% in 2027, while protesters are calling for higher public spending. Sansu argued investors should not escape immediate taxation simply by converting Bitcoin into dollar-backed tokens instead of euros. The measure sits inside a wider argument over tax fairness, though the protest movement has not specifically demanded a stablecoin tax, and the amendment offers no direct relief for living costs. The government came out against the text, warning that tracking these conversions could prove complicated.

Senate Stage and Enforcement Concerns

The amendment has cleared only one procedural hurdle. The October 16 vote covered the amendment alone, not the full 2027 budget, and the National Assembly must still review the remaining budget articles before the bill moves to the Senate. If it passes in final form, the tax would take effect on January 1, 2027. Resistance inside the government is already visible: the public accounts minister voiced doubts during the debate about whether the levy is workable and asked deputies to postpone it until the authorities set clearer definitions and tracking mechanisms. A Chainalysis executive raised a parallel concern, warning that investors could shift to decentralized exchanges and platforms outside international tax-reporting regimes, with particular worry about transactions no reporting framework captures. Separately, deputies are debating a requirement to report large self-custody wallets, those holding more than €100,000, with fines of up to €10,000 for non-compliance, a measure that would reach investors who keep assets under their own private keys rather than with an intermediary. The rules would cover a wide group of residents in France if adopted.

The arithmetic of the vote is this story's sharpest detail. A single-vote margin, with 25 abstentions and the government openly opposed, leaves the measure's fate uncertain through the Senate stage, and nothing in the National Assembly's vote record binds the upper chamber. For investors, the practical change is narrower than the headlines suggest: ordinary crypto-to-crypto swaps keep their deferral, and simply holding stablecoins triggers nothing, so the new liability bites only at the conversion step into MiCA-classified EMTs. The enforcement objections carry weight, since gains realized on decentralized platforms sit outside the reporting rails the amendment assumes. Traders in France should watch the Senate calendar and the definitions the tax authority ultimately publishes.