France could begin taxing certain cryptocurrency-to-stablecoin conversions from January 2027 under a proposal that would require investors to pay capital gains tax when moving into eligible stablecoins, rather than waiting until they convert their holdings into traditional currency.
The proposal was approved by the French National Assembly’s Finance Committee as part of the country’s 2027 budget discussions. It would make certain conversions taxable events, potentially exposing realised gains to France’s reported 31.4% flat-tax rate. However, the measure has not become law.
What the proposed tax would change
Under France’s current rules, exchanging one cryptocurrency for another generally does not trigger an immediate capital gains tax liability, provided no additional cash payment is involved. Tax is typically calculated when an investor sells crypto for traditional currency or uses it to pay for goods and services.
The proposed amendment, filed by lawmaker Nicolas Sansu, would remove this tax deferral for exchanges in which an investor receives certain electronic-money tokens, a category under the European Union’s Markets in Crypto-Assets Regulation (MiCA) that includes eligible fiat-backed stablecoins.
If adopted, the change would mean that converting an appreciated cryptocurrency into a qualifying stablecoin could trigger a tax bill, even if the investor keeps the proceeds within the crypto market instead of withdrawing euros to a bank account. The amendment proposes applying the change to transactions from January 1, 2027.
How the 31.4% rate could affect investors
The 31.4% figure reflects France’s reported flat-tax rate on relevant crypto gains, rather than a new rate created by the amendment itself. The proposal changes when certain gains become taxable, while the applicable tax rate would depend on the rules in force if the measure is enacted. For example, an investor who bought Bitcoin for €30,000 and later exchanged it for qualifying stablecoins when it was worth €100,000 would have a €70,000 gain before any applicable adjustments.
At a 31.4% rate, the illustrative tax would be €21,980. Under the existing deferral treatment, the exchange would generally not trigger tax at that point. The example assumes the proposed rule is enacted and the full gain is taxable under the applicable rules.
The potential change could affect traders who regularly convert volatile crypto holdings into stablecoins to preserve value between trades. Instead of waiting until they leave the crypto market, they could face a tax obligation when making certain stablecoin conversions.
Why lawmakers want to change the rules
The amendment’s stated rationale is that investors can currently defer taxation by converting crypto gains into stablecoins and continuing to use those tokens for payments or other crypto investments.
Its supporters argue that this creates a difference between investors who realise gains by converting crypto into euros and those who move into stablecoins without leaving the digital-asset market.
The proposal seeks to close that gap by treating certain stablecoin conversions as taxable disposals. Its scope, however, depends on the legal definition of electronic-money tokens in the amendment, rather than automatically covering every token commonly described as a stablecoin.
The proposal still needs legislative approval
The Finance Committee’s approval does not make the tax law. The committee subsequently rejected the revenue section of the 2027 budget bill, and the measure must proceed through the remaining parliamentary process before it can take effect.
The amendment would need to be considered and adopted through the public legislative process, followed by the remaining steps required for the budget to become law. Its final wording, scope and implementation could therefore change.
For now, France’s proposed change shows possible end to tax deferral for certain crypto-to-stablecoin exchanges, not a confirmed new tax obligation. Investors will need to follow the budget’s progress to see whether the measure takes effect in 2027.