Germany is preparing to end a tax break that lets private investors sell bitcoin BTC$79,395.64 and other cryptocurrencies without paying tax after holding them for more than a year.
A draft bill from the Federal Ministry of Finance, led by Vice Chancellor Lars Klingbeil, would make gains on crypto acquired after Dec. 31, 2026 taxable regardless of the holding period, according to a DTS report citing German newspaper Die Welt.
Crypto bought before that date would remain under the current rules. The proposal would also classify income from crypto lending and staking as capital income.
The change would bring bitcoin and ether ETH$2,501.38 under a tax system that treats gains more like returns from traditional investments. That’s Germany’s flat withholding tax regime, or Abgeltungsteuer, taxing gains 25% plus a 5.5% solidarity surcharge on the tax, an effective 26.375%, before any church tax.
NFTs, some stablecoins, security tokens and some tokens tied to real-world assets would remain outside the new regime, according to the report.
Short-term traders could benefit from the tax, as they’re currently taxed at an investor’s personal income rate, which has a 45% ceiling for the highest earners.
