French Government Targets Undeclared Crypto Holdings
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Loading... - Japheth Young
- 01 Jul 2024
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A recent report claims that only a small fraction of French cryptocurrency holders have declared their assets to the state, prompting government action. According to French IT magazine Clubic, the Ministry of Public Action and Accounts, along with the nation’s tax authorities, are preparing to crack down on undeclared crypto holdings.
The impetus for this action came after just 150,000 French residents accurately declared their cryptoassets at the end of the past financial year. The European Central Bank estimates that around 5 million French citizens hold cryptoassets, including Bitcoin (BTC). Tax officials suspect that many taxpayers are under-declaring their holdings.
New Legislation in the Works
The Ministry of Public Action and Accounts is collaborating with the Economy Ministry to introduce new legislation. This legislation will include a comprehensive set of measures designed to ensure compliance from crypto holders. These measures will be part of a broader anti-fraud initiative and are expected to be a significant wake-up call for French cryptocurrency enthusiasts.
Severe Penalties for Non-Compliance
In France, failing to declare crypto holdings on tax returns can result in fines up to 40% of the coins' total value. For professional crypto traders, this penalty can double to 80%. The new proposals could be discussed by lawmakers and senators in the coming weeks. If the bill faces no opposition in parliament, it could be enacted before the end of fall 2024, and the new rules would be in place before the end of the 2024 fiscal year.
Enhanced Powers for Tax Authorities
The Ministry of Public Accounts also aims to grant tax authorities new powers to investigate citizens' overseas assets and holdings. This would help officials target French crypto holders who attempt to hide their tokens in overseas wallets and crypto exchange platforms.
Crypto Popularity in France
A major French media outlet reported in March that 15% of people aged 18-24 have bought crypto, and 9% of French citizens have bought crypto at some point in their lives.
With the French government taking a hard stance on undeclared crypto holdings, crypto enthusiasts in the country should be prepared for increased scrutiny and stricter regulations in the near future.
