French Lawmakers Back Reporting Rule for Self-Custodied Crypto Wallets Over €100,000 ($112,000)
Key Takeaways
- •A French Finance Committee amendment would require holders of self-custodied crypto assets worth 100,000 euros or more to report them to tax authorities.
- •Failure to declare covered holdings could result in fines of up to 10,000 euros under the proposed addition to France's general tax code.
- •Sponsors justified the measure by citing a parliamentary inquiry that found 3.5 billion euros in crypto capital gains in 2021 but only 400 million euros in declared holdings.
- •The amendment was introduced by three members of the LIOT parliamentary group: Charles de Courson, Jean-Pierre Bataille, and Michel Castellani.
- •Committee approval does not guarantee enactment, as the committee rejected the budget bill's revenue section 31-3 and the amendment must be resubmitted during the National Assembly floor debate starting Tuesday.
French lawmakers have backed a proposal that would require holders of self-custodied cryptocurrency to report assets worth 100,000 euros ($112,000) or more, or face penalties.
Self-custodied crypto refers to holdings in wallets controlled directly by their owners rather than by an exchange or other intermediary, meaning such assets sit outside the channels through which crypto-asset service providers operate. It is this segment of the market that the measure targets.
The amendment, numbered I-CF821 and published on the National Assembly's website, was adopted by the chamber's Finance Committee on Friday. It would introduce reporting requirements for crypto assets not held through a crypto-asset service provider, including funds stored in personal wallets.
The measure would add a provision to France's general tax code. Holders would be required to disclose their holdings based on their value as of Dec. 31, and failure to declare could result in fines of up to 10,000 euros.
The sponsors said the measure is intended to combat tax evasion, citing a parliamentary inquiry into the taxation of wealthy individuals. That inquiry found that crypto capital gains reached 3.5 billion euros in 2021, while only 400 million euros in crypto holdings were declared to tax authorities that year — a gap the sponsors pointed to in justifying the disclosure requirement.
Proposal faces legislative hurdles
The disclosure requirement was introduced by Charles de Courson, Jean-Pierre Bataille and Michel Castellani, three members of France's Liberties, Independents, Overseas and Territories (LIOT) parliamentary group.
The wallet reporting measure was among five crypto-related amendments adopted by the Finance Committee last week. Other proposals previously reported by Cointelegraph included imposing an exit tax on cryptocurrency holdings exceeding 800,000 euros when taxpayers move abroad, and ending tax deferrals on conversions into fiat-backed stablecoins. French lawmakers also backed a stablecoin swap tax in the 2027 budget bill.
However, the committee's approval does not guarantee that the measures will become law. Shortly after adopting the amendments on Friday, the committee rejected the revenue section of the broader 2027 budget bill by 31 votes to 3.
Lawmakers are scheduled to begin debating the revenue section of the budget in the National Assembly on Tuesday, starting from the government's original draft. According to French tech publication Clubic, the crypto amendments would need to be submitted again and approved during the parliamentary proceedings before becoming part of the legislation. The floor debate beginning Tuesday will therefore show whether the wallet reporting rule returns to the text, with committee adoption marking only one stage in a budget process that still has further steps before anything becomes law.
