Germany Proposes 25% Flat Tax on Crypto Gains From 2027

Germany is preparing to end its long-standing tax break for crypto investors who hold assets for more than one year. A new draft from the Federal Ministry of Finance proposes a 25% flat tax on crypto gains from 2027, putting Bitcoin and other digital assets closer to stocks and other investments.

Germany Wants to End the One-Year Crypto Tax Break

Under Germany’s current rules, crypto gains are generally tax-free when an investor holds an asset for more than 12 months. Selling within that period can leave investors facing their personal income tax rate, which can reach 42%, plus the solidarity surcharge.

The new proposal would remove that one-year exemption for crypto bought from January 1, 2027.

Instead, profits would be treated as capital income and taxed at a flat 25% rate. With the solidarity surcharge, the effective rate would reach 26.375%, before any church tax.

Existing Bitcoin Holdings Could Keep Tax-Free Status

The proposal includes an important grandfathering rule for existing investors.

Crypto purchased on or before December 31, 2026 would remain under the current system. That means investors who already hold Bitcoin or other qualifying assets could still use the one-year tax exemption.