France's Assembly Rejects 2027 Budget Revenue Section, Stalling Crypto Tax Measures
France's National Assembly voted 458-0 on November 4 to reject the revenue section of its 2027 budget, removing proposed crypto measures from the bill sent to the Senate. The stablecoin conversion tax and self-custody reporting requirement could return through Senate amendments when budget debate begins November 20.
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Assembly Vote Removes Crypto Provisions
France's National Assembly rejected the revenue section of the government's proposed 2027 budget on November 4, with 458 lawmakers voting against and none in favor, according to the Assembly's official voting record. Two members abstained. The rejection means the budget proceeds to the Senate without the crypto amendments adopted during Assembly debates, which began October 13.
The rejection also blocks the Assembly from moving on to the expenditure section, because French budget procedure requires revenue provisions to be approved first, according to parliamentary broadcaster LCP. Reporting from The Defiant and Crypto.news agrees on the vote count and on the Senate timeline, but the two outlets frame the outcome differently. The Defiant describes the crypto measures as shelved, while Crypto.news stresses that they were removed from the version heading to the Senate and could still return if approved there.
The Stablecoin Conversion Tax
The most consequential of the removed measures was an amendment adopted October 16 that would have made certain crypto-to-stablecoin conversions taxable from January 2027. Under current French rules, exchanges between cryptocurrencies generally do not trigger capital gains tax unless the holder converts into fiat or uses the assets in a taxable transaction. The amendment targeted stablecoins classified as electronic money tokens under the EU's Markets in Crypto-Assets regulation, meaning an investor could have owed tax without withdrawing funds to a bank account.
The amendment passed the Assembly narrowly, 38 votes to 37 with 25 abstentions, after support from the Finance Committee. It was considered alongside a proposal allowing eligible crypto trading losses to offset future gains for up to 10 years.
Self-Custody Disclosure Requirement
On November 3, lawmakers approved a self-custody reporting amendment by 150 votes to 44, with eight abstentions. It would have required taxpayers holding at least EUR 100,000 (about $112,000) in qualifying self-custodied crypto to disclose those holdings to tax authorities, with the threshold measured on December 31 of the relevant tax year. Penalties of up to EUR 10,000 applied for non-compliance. Sources agree the measure was a disclosure obligation rather than a new annual tax on reported assets.
The threshold drew scrutiny during debate. Finance Committee rapporteur Philippe Juvin backed the principle of disclosure but questioned the level, with alternatives of EUR 5,000 and EUR 50,000 discussed before lawmakers settled on EUR 100,000. Public Action and Accounts Minister David Amiel questioned whether self-reporting would meaningfully identify taxpayers who intended to conceal holdings. A separate amendment would have raised penalties for platforms failing to provide information to tax authorities from EUR 10,000 to EUR 50,000.
Industry Response and Next Steps
Faustine Fleuret, global head of public affairs at lending protocol Morpho, argued in a LinkedIn post that policymakers should consider how existing tax rules can keep pace with financial innovation. "Finance is transforming faster than the law, taxation and sometimes even mindsets," she wrote.
The Senate's budget debate is scheduled to begin November 20. Any of the crypto amendments would need Senate approval, and then reconciliation between chambers, before becoming law.
Why It Matters
For Traders
Stablecoin conversions face no confirmed French tax from January 2027, but the Senate could restore the measure before the November 20 debate, so monitor those amendment votes.
For Investors
Removal from the Assembly bill signals French appetite for crypto taxation is contested, and the outcome will shape how EU stablecoin rules are applied domestically.
For Builders
Any French stablecoin conversion tax would hit on-chain swap flows, so teams serving French users should model taxable event triggers now.
This article is for information only and is not financial advice. Read the full disclaimer.
