Germany's Bitcoin Tax-Free Era Set to End in 2027
Germany's unique tax-free era for Bitcoin and other cryptocurrencies is set to come to an end. According to a draft law from the finance ministry, every sale of crypto assets will become taxable as of January 1, 2027. Currently, German investors can hold their coins for at least 12 months without paying taxes on profits.
The proposed new rules would introduce a flat 25% withholding tax on gains, with an additional solidarity surcharge. The first €1,000 ($1,163) of yearly gains would remain exempt from taxation, and losses could be written off against other gains.
However, the draft law has been met with criticism from some investors who argue that it unfairly targets long-term holders. The finance ministry claims that the exemption rewards speculation, but under the new rules, top-rate traders flipping coins within a year would pay roughly 26%, down from 42% today.
The government expects to collect €160 million ($186.2 million) in taxes from crypto sales in 2028, rising to €350 million ($407.35 million) by 2031. The draft law still needs to pass through the cabinet and two parliamentary chambers before it becomes law.