The government of France has proposed a hefty 31.4% capital gains tax on European Union-regulated stablecoins.
Analysts have been quick to say that the tax could drive investors to move their stablecoins outside the European Union (EU).
The proposal in France’s legislature is part of the country’s 2027 budget, which arrives as the European nation faces a debt crisis and fiscal crunch.
France already levies a 31.4% capital gains tax on other cryptocurrencies such as Bitcoin (CRYPTO: $BTC).
Now, the government is proposing to extend that tax to stablecoins such as Tether (CRYPTO: $USDT) and Circle Internet Group’s (NYSE: $CRCL) coin (CRYPTO: $USDC).
Stablecoins are cryptocurrencies whose value is pegged to another asset, typically the U.S. dollar.
The new proposal would make it a taxable event in France when investors exchange crypto such as Bitcoin for stablecoins.
If approved, the new tax would come into effect and apply to stablecoins starting on Jan. 1, 2027.
France currently applies a 31.4% flat tax to crypto capital gains when investors cash out or spend their digital asset holdings.
In the U.S., cryptocurrencies and stablecoins are subject to a capital gains tax of 10% to 20%, depending on a person’s income for the year.
Chainalysis estimates that France reported $9.4 billion U.S. worth of taxable crypto activity in 2025, including $2.5 billion U.S. in gains among investors.
In contrast to France, Greece is proposing a 10% capital gains tax on cryptocurrencies in an effort to attract greater investments.
Bitcoin is trading at $82,800 U.S. on Oct. 14.
