Germany plans to end crypto tax break

• Germany has drafted plans to end its one-year tax-free crypto holding rule from 2028.
• The proposed capital gains tax rate is 25%, rising to 26.375% after the solidarity surcharge.
• Crypto bought by 31 December 2026 would remain covered by the current rules under the draft.

Germany has circulated a draft bill that would end the one-year tax-free holding rule for crypto from 2028.

The proposal would move crypto gains from Section 23 into Section 20 of Germany’s Income Tax Act.

Under the draft, crypto gains would face a 25% capital income tax, plus a 5.5% solidarity surcharge.

This would produce a combined rate of 26.375% before any applicable church tax, while a €1,000 personal allowance would remain.

The draft would also allow crypto gains and losses to be offset against gains and losses from stocks and other securities.

Crypto acquired on or before 31 December 2026 would remain under the current rules, meaning the 12-month holding period could still apply.

The proposal remains under interdepartmental consultation and would still need cabinet approval, parliamentary votes and Bundesrat approval before becoming law.