France’s Conseil d’Etat (Council of State), a body of the national government that provides the executive branch with legal advice and acts as the supreme court for administrative matters, has decided to reduce the tax rate on cryptocurrency sales from 45 to 19 percent.
On Thursday, April 26, the Council of State said that such a huge change is a result of a new classification of Bitcoin separate from commercial or non-commercial activity.
Currently, gains from the sale of cryptocurrency trading are considered to be “industrial and commercial profits”, while profits from occasional transactions are still non-commercial profits.” So, the profits arising from cryptocurrency sales should be considered as capital gains of “movable property”.
“The sale of ‘bitcoins’ fell under the principle from the category of capital gains of movable property,” the Council of State said.
However, that the Council of State said certain types of transactions may “fall under provisions relating to other categories of income,” and that proceeds from cryptocurrency mining as well as commercial activities related to the technology will still be taxed at the BIC rate.
France elected the very young Emmanuel Macron who gave an encouraging sign by allowing himself to be photographed with a cold storage wallet. It would later be revealed as a publicity stunt prior to his run. But, nevertheless, he at least seemed familiar with the technology.
It is important to note that the Council of State is now putting the sale of cryptocurrency on the same level as that of movable property. The movable property designation usually applies to more tangible assets, such as jewelry, cars, and so forth. However, it also applies to intangible goods, such as patents, copyrights, and now cryptocurrencies.
With the flat fee of 19% now applying to all of these products and assets, a more lenient ecosystem has been created which may allow cryptocurrencies to thrive in the years to come.
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