AfD's Saxony-Anhalt Landslide Threatens German Crypto Tax Plans

Germany's far-right Alternative for Germany (AfD) party has made significant gains in the eastern state of Saxony-Anhalt, capturing nearly 44% of the vote and potentially influencing the country's push to abolish the tax exemption on long-term Bitcoin holdings.

The AfD secured 39 out of 83 seats in the parliamentary election, three short of an outright majority. Chancellor Friedrich Merz's Christian Democratic Union (CDU) was trounced by a wide margin, with its party-list share collapsing to 17.2% from 37.4% in the previous election.

The AfD has been a vocal opponent of expanded crypto asset taxation, and this victory gives the party an additional platform from which to exert influence over the legislative process. The federal government is currently preparing legislation to alter the taxation of long-term crypto investment gains starting in 2027.