France's Proposed Crypto Tax is Economically Unjust: Experts

France's National Assembly recently passed a contentious amendment introducing a 1% annual tax on crypto holdings, classified as 'unproductive wealth.' This marks the first time cryptocurrencies are explicitly targeted by a wealth tax, alongside traditional luxury assets. Experts criticize the amendment for failing to differentiate between passive investors and active ecosystem contributors, suggesting that it may hinder innovation and drive talent out of France. The measure applies to net wealth exceeding €2 million ($2.2 million), raising concerns that it could penalize crypto founders and innovators. Stakeholders argue that such a broad approach risks mischaracterizing the nature of digital assets and could create disincentives for long-term investment. The bill will now proceed to the Senate for further deliberation, with the ultimate goal of finalization by the end of the year, amid warnings that such taxation policies could lead to capital flight as investors seek jurisdictions with more favorable conditions for crypto holdings.

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