TLDR
- Germany plans to raise 2 billion euros in revenue by changing its cryptocurrency tax system starting in 2027.
- Finance Minister Lars Klingbeil said the government wants to impose different taxes on cryptocurrencies.
- Germany currently exempts personal cryptocurrency profits from tax after a one-year holding period.
- The Treasury has confirmed that the one-year rule also applies to staking and lending activities.
- Industry groups believe the government could target retention exemptions to generate revenue.
Germany is preparing to revise its cryptocurrency tax system from 2027. The government aims to raise 2 billion euros, or about $2.3 billion, through new cryptocurrency tax measures. Authorities are also planning tighter controls to tackle financial crime and improve reporting compliance.
Germany Considers Cryptocurrency Tax Reform with Aim to Exempt Holding
Finance Minister Lars Klingbeil announced the plan during a press conference on the 2027 federal budget on April 29. He said the government wants to “tax cryptocurrencies differently” and capture additional revenue. But he did not specify which existing rules would change.
Under current law, Germany taxes personal cryptocurrency profits if the investor sells within one year. After one year, authorities generally exempt the gains from tax under the “Haltefrist” rule. Long-term holders thus benefited from one of Europe’s more favorable regimes.
The Treasury has reaffirmed that the one-year rule will also include staking and lending in 2022 and 2025. A previous proposal proposed extending the retention period to 10 years. However, the Ministry of Defense withdrew this plan and maintained the 12-month period.
Industry groups believe the exemption could be revised under the new proposals. The German Bitcoin Association said holding period will be the most obvious source of revenue. Meanwhile, officials have not released a draft version of the bill.
Cryptocurrency tax accountant Robin Thatcher told Cointelegraph that scrapping the 12-month exemption would weaken Germany’s position as a cryptocurrency hub. “Rather than Germany changing its policy, other countries should follow suit,” he said. He added that the rule supported retail participation.
Germany aligns supervision with EU reporting standards
Germany has already strengthened supervision through the EU’s DAC8 framework. Starting in January, the Crypto Asset Tax Transparency Act will require cryptocurrency service providers to report customer transactions. The authorities now share that data with the Federal Tax Office and other EU agencies.
This reporting framework reduces opportunities for undeclared cryptocurrency transactions. It also improves transparency between member states. As a result, tax authorities can more effectively track cross-border digital asset activity.
Austria abolished its own tax-free holding period in 2022. The country now taxes cryptocurrency gains at a fixed 27.5% capital gains tax rate, regardless of holding period. These changes bring Austria closer to traditional investment tax treatment.
Thatcher said Germany could move “broadly in line with Austria” following a similar model. He also noted that the UK has a top capital gains tax rate of 24%. He argued that abolishing the exemption would eliminate Germany’s current structural advantage.
Bitpanda co-founder Eric Demuth criticized Austria’s decision in a post on X on March 12. He called it a “very foolish decision” and said it added bureaucracy with little financial benefit. A Bitpanda spokesperson told Cointelegraph that the reforms should not be “simple monetization.”
Erald Ghoos, CEO of OKX Europe, said the plan would impact adoption and competitiveness. He said Austria’s approach created compliance burdens with limited revenue benefits. Germany has yet to release detailed legislative proposals for a 2027 cryptocurrency tax overhaul.