German Parliamentary Committee Rejects Crypto Tax Overhaul, Keeps 1-Year Capital Gains Exemption
Summary
- Cryptopolitan reported that Germany’s Bundestag Finance Committee rejected a tax overhaul that would abolish the tax exemption for long-term crypto holdings.
- As a result, Germany’s system granting a capital gains tax exemption on sales after holding for more than one year will remain in place.
- Some in the market said the decision means Germany will maintain a relatively crypto-friendly investment environment within Europe.
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Germany’s Bundestag Finance Committee has rejected a tax overhaul that would have eliminated a capital gains tax exemption for long-term crypto holdings. The decision leaves intact the current rule under which investors in Germany can sell digital assets tax-free after holding them for more than one year.
Cryptocurrency news outlet Cryptopolitan reported on May 22 that the proposal, backed by Germany’s Green Party, was voted down by the committee.
The bill would have scrapped the existing system that exempts capital gains from tax when crypto assets are sold after a holding period of more than one year.
Under current German tax law, individual investors do not pay tax on gains from crypto sales if they held the assets for longer than a year.
The Green Party argued that crypto assets should be taxed under the same rate structure as other investment assets. Opponents countered that the overhaul could end up imposing a heavier tax burden on crypto investors than on stock investors.
The party estimated that abolishing the exemption could generate about 11.4 billion euros in additional annual tax revenue for the German government.
The decision also means Germany is set to retain a relatively crypto-friendly investment environment within Europe, according to market participants.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.
