[DigitalToday reporter Yoonseo Lee (이윤서)] France is pushing a tax overhaul that would also tax transactions swapping bitcoin or ethereum into some stablecoins such as USDC.

CryptoSlate, a blockchain outlet, reported on Oct. 12 (local time) that the finance committee of the French National Assembly adopted amendment I-CF1826 on Oct. 7. It would overhaul how individuals calculate crypto investment gains and losses and exclude some crypto-to-crypto swaps from tax deferral. If it passes, it would apply to disposals and exchanges that occur from Jan. 1, 2027.

Under current French tax guidance, tax deferral is allowed for crypto-to-crypto swaps that do not involve cash settlement. By contrast, transactions that convert crypto into fiat currency or use it to buy goods and services can be taxable. The amendment would prevent deferral when the asset received in an exchange falls under the MiCA EU crypto regime definition of an "e-money token."

Those behind the amendment described the current structure, which defers tax when swapping into fiat-backed stablecoins, as a "legislative loophole." For investors who swap crypto into stablecoins to reduce price volatility risk, it would bring forward the taxation point.

The method for calculating acquisition cost would also change. Under current rules, part of the acquisition cost of an entire crypto portfolio is allocated to each taxable transaction. The amendment would instead calculate gains and losses based on the acquisition cost of the disposed asset. When the same type of asset was bought at different prices, a weighted average acquisition cost would apply.

Transitional rules would apply to assets acquired before 2027. Investors could apply the actual acquisition cost by proving it, or allocate the portfolio acquisition cost calculated under the existing method as of end-2026 in proportion to each asset's valuation. The chosen method would be fixed when reporting the first taxable transaction from 2027 and would apply to the entire portfolio and could not be changed thereafter.

Depending on the choice, the taxable gain could differ even for the same transaction. The actual acquisition cost method reflects the purchase cost of the relevant asset, while the allocation method recalculates acquisition cost based on the asset's share of the portfolio's valuation.

The acquisition cost of the asset received in an exchange also differs depending on whether the exchange is taxable. In an exchange where tax is deferred, the acquisition cost of the original asset carries over to the new asset. In a taxable exchange, the valuation at the time of the transaction becomes the new acquisition cost. Therefore, if a gain was taxed when swapping bitcoin into USDC, no additional gain would arise if the USDC is later sold for the same amount.

Limits on the treatment of losses would remain. Under French tax authority guidance, crypto gains and losses arising in the same tax year can be offset, but net losses cannot be carried forward to the next year or offset against gains from other assets. That means tax may arise even if the final asset value recovers to its initial level when losses and gains occur in different years.

Legislative procedures remain. Materials for the 2027 budget bill show that a plenary discussion schedule at the French National Assembly is set for Oct. 13. How the scope of taxation on stablecoin swaps and the acquisition cost calculation method are finalised in further review will be key.