What crypto tax change is Germany proposing?

Germany plans to remove its one-year crypto holding tax exemption under a proposed 2027 federal budget reform. If approved, crypto gains would become taxable regardless of how long investors hold their assets.

How are cryptocurrencies currently taxed in Germany?

Under current German rules, crypto assets are treated as private property. Investors can sell Bitcoin and other cryptocurrencies tax-free if they hold them for more than 12 months.

What tax rate would apply under the new proposal?

The proposal would apply Germany’s standard 25% capital gains tax to crypto profits. Investors could also face additional solidarity and church tax charges depending on their circumstances.

Why is Germany considering ending the crypto tax exemption?

The government is trying to reduce an estimated €98 billion budget deficit through spending cuts and new tax measures. Finance Minister Lars Klingbeil included the crypto reform within a broader 2027 fiscal package.

Who is pushing for the crypto tax reform?

The proposal is being driven by Germany’s Social Democratic Party (SPD) under Finance Minister Lars Klingbeil. The SPD previously attempted to remove the exemption during coalition negotiations in 2025.

Why did earlier attempts to change the crypto tax fail?

The CDU/CSU political bloc opposed previous proposals during coalition talks, leading to the plan being removed from the 2025 coalition agreement. The latest version may be harder to block because it is embedded within the federal budget.

How is Germany’s crypto industry reacting?

Industry groups strongly oppose the proposal and argue it represents a disguised tax increase. The Bitcoin Bundesverband said the reform contradicts earlier political promises supporting tax relief.

What did Bitpanda co-founder Eric Demuth say about the plan?

Eric Demuth criticised the proposal and called it “an extremely stupid decision.” He argued Austria’s similar crypto tax reform increased bureaucracy without significantly improving tax revenues.

Germany revives plan to end crypto tax exemption

Written by Brie CarterPublished May. 7 2026Last Updated May. 7 2026

Germany is preparing to end its long-standing crypto tax exemption as Finance Minister Lars Klingbeil revives a proposal to tax digital asset gains regardless of holding period.

The measure forms part of Germany’s 2027 federal budget package and is expected to be approved by the Federal Cabinet this week.

Under existing German tax rules, cryptocurrencies are treated as private assets, allowing investors to sell Bitcoin and other tokens tax-free after holding them for more than 12 months.

The proposed reform would instead apply Germany’s standard 25% capital gains tax rate to crypto profits alongside additional solidarity and church tax charges where applicable.

The initiative marks the latest attempt by the Social Democratic Party to remove the exemption after a similar proposal failed during coalition negotiations in 2025 following opposition from the CDU/CSU bloc.

Klingbeil has now reintroduced the measure as part of a broader budget strategy aimed at addressing an estimated €98 billion fiscal deficit through spending cuts and new taxes.

The package also includes planned levies on products including alcohol, tobacco, sugar and plastic while reducing expenditure on pensions, social welfare and healthcare programmes.

Germany’s crypto industry has strongly criticised the proposal, with the Bitcoin Bundesverband warning the measure effectively represents a disguised tax increase that contradicts earlier promises of tax relief.

Bitpanda co-founder Eric Demuth described the proposal as “an extremely stupid decision” and argued that Austria’s similar tax reform in 2022 increased bureaucracy without delivering meaningful revenue gains.

Legal specialists have also questioned whether imposing stricter tax treatment on cryptocurrencies while maintaining exemptions for comparable private assets could face constitutional challenges under Germany’s equal-protection principles.

At the time of reporting, Bitcoin price was $81,561.37.