Germany Plans 25% Crypto Tax on New Holdings From 2027

Germany’s Federal Ministry of Finance has proposed a 25% tax on gains from cryptocurrency acquired after December 31, 2026, potentially ending one of the country’s biggest tax advantages for long-term crypto investors.

Under the reported draft legislation, newly acquired Bitcoin, Ethereum and other cryptocurrencies would generally be subject to Germany’s 25% Abgeltungsteuer, or flat-rate capital income tax, when sold at a profit. The current rule that can make crypto gains tax-free after a holding period of more than one year would no longer apply to these new purchases.

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The proposal is not yet law. It must still go through Germany’s legislative process and could be amended, delayed or rejected.

What Would Change Under the Proposed Tax Reform?

Under Germany’s current rules, privately held cryptocurrency can generally fall under the country’s private disposal transaction regime. If qualifying crypto is held for more than one year, gains from its sale can generally be tax-free.

The proposed reform would change that treatment for cryptocurrency acquired after December 31, 2026.

Instead of becoming tax-free after one year, gains on newly acquired crypto would generally be subject to a 25% flat tax regardless of how long the investor holds the asset.