France is to tax profits from the sale of cryptocurrencies as capital gains on movable property. The country has changed the approach to lower rates from 45% to 19%. Earlier this year, the Supreme Administrative Court of France was asked on behalf of taxpayers, questioning the established regime, in force since July 2014, regarding taxation of bitcoins and other transactions related to cryptocurrencies.
In line with the mentioned tax legislation, profits from the sale of cryptocurrencies were considered as commercial and industrial profits in the case of ordinary and continuous operations and as non-commercial gains in occasional events. Thanks to this categorization, taxpayers were subjected to various rates, which could have reached even 45%.
As reported by French media Le Monde, the Council of State changed the approach to partially adjudicate in favor of the plaintiffs in the above-mentioned case. The institution decided to reconsider how the profits resulting from the sale of cryptocurrencies are regulated and now they see them as profits from movables. This means that they are to be taxed at a fixed rate of 19%, which is significantly lower than the previous position, even if a generalized social contribution (CSG) is added to 17.2%.
The Council of State also reported that "there are specific circumstances specific to cryptographic asset transactions that may imply that they are subject to rules on other categories of income". In other words, if capital gains would result, for example, from activities other than cryptocurrencies-related sales, such as the extraction of Bitcoins, they would fall into the category of commercial and industrial profits under the previous regime, irrespective of whether the activity was carried out or she was only occasional. Therefore, these profits will be taxed at a higher rate of 45%.
At the end of last year, the head of AM (the French regulator of the stock markes) expressed his positive opinion on cryptocurrencies, stating that they could meet a legitimate business need. However, the general attitude of the country has changed many times over the past few months. We have already seen that the Governor of the Bank of France calls for a greater emphasis on the cryptocurrency exchanges.
Let's now take a look at the bitcoin technical picture on the H4 time frame. The market is hovering just above the weekly pivot at the level of $9,208 as it is testing the intraday trend line support as well. A breakout lower would indicate a slide towards the level of $8,700 and even a possible test of the technical support at the level of $8,355. On the other hand, a rally higher (which is still possible according to the current Elliott wave count) would bring a new local high in the last wave 5, so the level of $9,719 would have been broken. The projected target is seen at the level of $9,826.
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