Crypto Frontline

France Adjusts Taxation for Cryptocurrencies

France Adjusts Taxation for Cryptocurrencies

France Adjusts Taxation for Cryptocurrencies
November 12
09:53 2018

 

For the past few months, there had been significant activity from French authorities with regards to digital assets regulation. The government and the parliament had worked jointly and as we have discussed in a previous article, an important ICO regulatory framework had been adopted.

The objective is to make France one of the most competitive ICO hubs and bring new blockchain-based start-ups into the country.

Cryptocurrency taxation

France had also joined a number of countries like Spain, Malta, and Switzerland, where cryptocurrency transactions are subject to taxation. As we have written in the article related to Bitcoin taxation, we encourage all people to declare their cryptocurrency-related income, so we cheer the move coming from the French officials.

Adjustments for 2019

At the present time, France has 3 models used to determine the taxation method applicable to cryptocurrencies, based on sales periodicity, occasional, habitual or based on whether the income came from cryptocurrency mining activities, as crypto-economy.net had recently stated.

However, the National Assembly Finance Commission had amended the 2019 budget which contains a reduction to 30% taxes for digital assets. Eric Woerth, the current chairman of the Commission, emphasized the importance of a simplified taxation methodology, acknowledging that the main purpose of this decision is to set a valuation on cryptocurrencies with fewer variations.

Positive approach to cryptocurrencies

The move sparks some short-term enthusiasm among cryptocurrency aspiring people since France joins the countries with an inclusive approach to digital assets. The country recognizes the importance and great potential of the blockchain technology, one that could have great positive implications for the overall productivity growth in the near to long-term horizon.

Other countries like China, had imposed a total ban on digital assets, but despite that, we have businesses in the blockchain industry operated by Chinese entrepreneurs (some major exchanges like Bitfinex and Binance, are some good examples). Also, people are managing to bypass the government ban, thanks to the loopholes the internet can create.

We can conclude that banning cryptocurrencies and other related activities is not the best way to solve the problems. Instead, developing an appropriate regulatory framework in which companies can develop and act ethically has far greater positive implications.

Even though the price of cryptocurrencies had slumped this year, we can actually see a gradual integration of digital assets, among capitalistic states, which could help them economically in the years to come.