Bitcoin News Today: France's Crypto Tax Debate: Innovation vs. Ideological Overreach?

France's National Assembly has approved a controversial amendment to tax large cryptocurrency holdings as "unproductive wealth," marking a significant shift in the country's approach to wealth taxation. The measure, introduced by centrist MP Jean-Paul Matteï, passed with 163 votes in favor and 150 against, backed by an unusual coalition of socialist and far-right lawmakers, according to Cryptopolitan. If finalized in the 2026 budget and ratified by the Senate, the tax would apply a 1% levy to net taxable assets exceeding €2 million, reclassifying digital assets alongside luxury items like gold, art, and yachts as non-productive, according to Coinotag.

The amendment replaces France's existing real estate wealth tax, the Impôt sur la Fortune Immobilière (IFI), with a broader framework targeting assets that do not directly contribute to economic productivity, according to TheCoinRise. Under the new rules, only one primary residence—up to €1 million in value—would be exempt. The tax would also apply to non-productive real estate, private aircraft, and life insurance policies not tied to productive investments, as Connexion France notes. Critics argue the reform is ideologically driven, equating crypto with idle assets rather than recognizing its potential role in innovation, according to TradingView.

Industry figures have raised alarms, warning the tax could spur capital flight. Éric Larchevêque, co-founder of crypto wallet maker Ledger, called the move an "ideological error" that punishes savers seeking stability in Bitcoin and gold, Cryptopolitan reported. He highlighted practical risks, including forced asset sales for liquidity-challenged investors, and cautioned that lowering the €2 million threshold in future legislation could widen the tax's impact, as noted by TradingView. Cyrille Briere, a decentralized finance consultant, added that singling out crypto while exempting stocks creates an uneven playing field, potentially stifling innovation, Coinotag reported.

The legislative path remains uncertain. While the amendment cleared the National Assembly, it must now pass the Senate and be integrated into the 2026 budget—a process complicated by broader political instability. Prime Minister Sébastien Lecornu's government, facing a fractured parliament, has avoided using constitutional tools like Article 49.3 to fast-track the budget, leading to a revised tax plan that raises revenue to 45.1% of GDP, up from the government's target of 43.9%, according to Bloomberg.

Amid the debate, France's crypto ambitions appear contradictory. While lawmakers push to tax digital assets, others advocate for building a national Bitcoin reserve. A separate proposal by centrist MP Eric Ciotti aims to accumulate up to 2% of Bitcoin's supply—approximately 420,000 BTC—through energy-efficient mining over seven to eight years, Cryptopolitan has reported. This duality underscores tensions between regulatory caution and strategic investment in crypto.

The tax's economic impact remains speculative. Proponents argue it encourages productive investment, while opponents warn it could deter crypto adoption and innovation. With Senate approval pending, investors are advised to monitor legislative shifts and consult tax professionals to navigate the evolving landscape, according to Coinfomania.