A new German draft bill seeks to eliminate tax-free crypto holding periods by 2027, subjecting Bitcoin and Ethereum profits to a 25% flat tax rate plus surcharges.
Germany's proposed draft bill introduces a 25% flat tax on crypto gains starting January 1, 2027, effectively ending the current tax-free status for assets held longer than one year. While existing holdings remain exempt under current rules, the new policy treats future Bitcoin investments as capital income, which may dampen long-term institutional and retail demand in the region.
No, the law only applies to crypto assets purchased on or after January 1, 2027.
The flat rate is 25%, plus a 5.5% solidarity surcharge, resulting in an effective rate of 26.375% before any applicable church tax.
Ethereum is explicitly included in the German draft bill, which seeks to reclassify crypto assets as private capital investments rather than economic goods. By subjecting staking and lending income to the new 26.375% effective tax rate, the proposal removes the tax advantages that previously incentivized long-term Ethereum holding and participation in network validation.
Income from staking and lending will be classified as capital income and subject to the new flat tax rate.
Yes, the draft allows for losses to be offset against gains, including those generated from shares.
Germany's Finance Ministry has drafted legislation to impose a 25% flat tax on cryptocurrency gains, effectively ending the current exemption for assets held longer than one year. The policy, slated for a January 2027 rollout, aims to treat digital assets like traditional capital investments such as stocks and dividends.
No. The proposed law only applies to crypto assets purchased on or after January 1, 2027. Assets acquired before this date remain subject to current tax rules.