The French Council of State announced on Thursday that the profits generated by cryptocurrencies should be considered as capital gains, which means the tax will be cut from the current 45% to 19%, Le Monde reports.
This comes due to a change in the classification of cryptocurrency. France’s highest administrative court, the Council of State, determined that cryptocurrency profits are considered “movable property” and therefore subject to a lower tax rate than had previously been imposed.
After adding contributions to the social welfare system, the new rate goes up to nearly 35 percent, which is still a 25 percent reduction of the original fees.
In its communiqué, the Council of State nevertheless emphasizes that "certain circumstances specific to the transaction" of crypto assets may imply that they fall under provisions rules relating to other categories of income.”
Thus, if the profit has been generated as a result of mining Bitcoin (TIKER: BTC.EXANTE) mining remain subject to the original tax rate, while the lower rate is specifically designed for investment gains.
By Jade Olafson