France appears ready to consider giving Bitcoin owners in the country a tax cut. This move comes as regulators in the country wish to streamline all non-real estate-related tax requirements.
Tax Cut for Bitcoin ‘Hodlers’
According to Reuters, the lower House of Parliament in France is looking to cut taxes for Bitcoin owners. On Wednesday (November 7, 2018), the House’s Finance Commission adopted a reduction of the capital gain taxes on the sale of cryptocurrencies like Bitcoin. This move formed part of the Commission’s amendment to the country’s 2019 budget bill.
Based on this development the capital gains tax on cryptocurrency sales will drop from 36.2 percent to 30 percent. Thus, Bitcoin and other digital currencies will now be in the same tax bracket as other non-real estate assets.
The new tax provision hasn’t been passed into law. For now, it is merely a part of the amended 2019 budget bill. If the bill is passed into law, then the new tax percentage for cryptocurrencies in France becomes legally binding.
Apart from Initial Coin Offerings (ICOs) and cryptocurrency exchanges, taxation is another cardinal aspect of virtual currency regulation for many countries. However, not many have been able to create a clear regulatory framework for cryptocurrency taxes.
France’s approach mirrors that adopted by South Africa earlier in the year. In April, Live Bitcoin News reported that the South African Reserve Service (SARS) – the country’s tax body, was going to apply standard income tax rules to cryptocurrencies.
For some countries, the problem with creating clear-cut rules for taxing digital currencies comes from a lack of consensus on the precise definition of the asset class. The United States, for example, has seen several stakeholders call for more concise cryptocurrency tax laws.
France Expanding its Cryptocurrency Regulatory Framework
If the Bitcoin tax cut becomes law, it will be yet another step by French authorities to improve the regulatory landscape of the country’s cryptocurrency industry. In September 2018, Bruno Lemaire, the French Minister of Economy and Finance announced the approval of a legislative framework to govern ICOs in the country.
The ICO laws majorly focused on investor protection protocols and came shortly after regulators in the EU called for a unified virtual currency regulatory paradigm for the region. So far, it seems France’s attitude towards cryptocurrency has softened somewhat since the start of 2018.
What do you think about France’s move to cut Bitcoin taxes? Let us know your thoughts in the comment section below.
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Author: Nick Omo