Germany is preparing to end one of Europe’s most famous crypto tax perks: a draft law would slap a flat 25% tax on cryptocurrency gains from 2028, removing the exemption that currently makes Bitcoin sold after one year of holding tax-free.
By Ana Gonzalez | September 9, 2026
According to a Der Spiegel report, Germany’s Federal Ministry of Finance has drafted legislation that would bring crypto gains under the country’s capital income tax — the Abgeltungsteuer — the same 25% flat rate already applied to stock and securities gains. The rules would cover crypto assets bought after January 1, 2027, with the tax taking effect in 2028. The draft has already been circulated among other federal ministries for review. For Germany’s long-term crypto holders, the deal that made “just hold for a year” a national investing mantra may be entering its final stretch.
The Hook: The One-Year Rule on the Chopping Block
Here’s how German crypto taxes work today — and what would change:
- Current system: crypto is treated as a private asset. Sell within 12 months of buying and gains are taxed at your personal income tax rate, which can reach 45%. Sell after more than a year of holding, and gains are generally tax-free.
- Proposed system: a flat 25% tax on crypto gains under the Abgeltungsteuer, regardless of how long you held — at least for assets acquired after January 1, 2027.
- Allowance kept: the existing 1,000 EUR exemption threshold for private disposal transactions is expected to remain.
- Revenue target: the Finance Ministry expects roughly 350 million EUR in additional tax revenue from the measure.
The Odd Silver Lining for Short-Term Traders
The change isn’t uniformly bad news for taxpayers. Top earners who currently face up to 45% on short-term gains would see their rate drop to 25%. And once crypto falls under the capital income tax system, gains from digital assets could be offset against losses from stocks and other securities — something the current rules don’t allow. People whose personal tax rate falls below 25% can also request a “Günstigerprüfung,” a standard German tax assessment that checks whether applying the lower personal rate produces a smaller bill.
The biggest open question: what happens to coins bought before January 1, 2027? The treatment of previously purchased holdings has yet to be decided, according to the report. Millions of German holders acquired Bitcoin, Ether, and other assets under the old rules, and their tax fate is now a bargaining chip in the legislative process.
The Core Conflict: A Government Reversal After Months of Warnings
The draft follows a year of escalating signals. Finance Minister Lars Klingbeil said during an April presentation of the 2027 federal budget that the government intended to “tax cryptocurrencies differently,” linking the change to a broader package meant to raise an extra 2 billion EUR while cracking down on financial and tax crime. In July, Klingbeil confirmed a concrete bill was in preparation but declined to detail its contents.
Parliament has already fought over this ground once. In May, the Finance Committee rejected a Green Party proposal to end the one-year tax exemption. CDU/CSU, the Social Democrats, and the AfD all opposed it — though for different reasons — while Die Linke supported it with reservations. The SPD argued at the time that the government’s own legislative proposal was already on the way, and this draft is that proposal materializing.
Politics has only gotten more complicated since. The AfD, which backs preserving the 12-month exemption and has submitted its own Bundestag proposal to that effect, won nearly 44% of the vote in this week’s state election in Saxony-Anhalt. Tax law remains a federal matter in Germany, so a state result cannot block the levy — but it hardens the political weather around it.
What It Means for Crypto Investors — in Germany and Beyond
Germany has been one of Europe’s most crypto-friendly tax jurisdictions, and the one-year rule was a big reason. If the 25% flat tax becomes law, the incentive to hold through volatility weakens, and Germany’s competitive position shifts toward countries with lighter treatment. Expect a rush of activity before the January 1, 2027 acquisition cutoff: buying under the old regime may still preserve better treatment for those coins, though that detail is unsettled.
The move also fits a wider European pattern of tightening crypto taxation and enforcement as governments search for revenue. For investors outside Germany, it’s a reminder that crypto tax rules everywhere are political decisions — and they can change.
The Verdict
The draft still needs to survive ministerial review and the Bundestag, and the treatment of pre-2027 holdings will be the fight to watch. But the direction is clear: Germany’s tax-free year for patient crypto holders is living on borrowed time. Anyone holding crypto in Germany — or planning to — should mark January 1, 2027 on the calendar and watch this bill closely.
As of this writing, Bitcoin trades at approximately 79,100 USD, Ethereum at 2,505 USD, and Solana at 104 USD. The cryptocurrency market remains highly volatile. This article is for informational purposes only and does not constitute financial or tax advice.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency markets are volatile; always do your own research before investing.
Everything bought before January 2027 keeps the one-year rule, so there are roughly 15 months left to stack tax-free in Germany. Exchanges better brace for a registration rush.
350 million EUR a year is the whole motive. Once the Finance Ministry smelled that revenue the one-year rule was doomed no matter what holders lobbied for.
Silver lining nobody mentions: 25% flat beats the 45% top rate on short-term gains, and offsetting crypto losses against stock losses finally works. Active traders might come out ahead.
The silver lining math only works for active traders. If your whole plan was hold 366 days and pay zero, going from 0 to 25 percent is not a trade-off, it is just a bill.
der spiegel says the draft only covers assets bought after jan 2027. grandfathering existing stacks was the only way this passes without a run on exchanges
agree on the political math. a retroactive version would have triggered sell-offs before the vote even happened, grandfathering was the only way this draft survives committee
so the obvious move is buy everything before jan 2027 and ride the old rule. they literally handed us a 15 month window lmao
grandfathering only helps if the coalition does not gut it in committee. wait for the actual gesetzestext before panic buying the 2027 window
the window trade only works if you actually hold 366+ days. everyone buying 2026 bags planning to flip in march is in for a surprise
Also the window only covers coins bought before Jan 2027, anything bought after pays from day one. Plenty of people will misread that part
true, expect a wave of angry posts in early 2028 from people who bought in 2027 and assumed the old rule still applied
25% flat under abgeltungsteuer still beats the current 45% income tax on short term holds. everyone acting like this is the apocalypse
and losses offset against stock gains finally, thats the buried headline. old rule was tax free but bagholders got zero offset, nobody mentions that
this. anyone who traded through 2022 with bags they couldnt offset knows the no-loss-offset rule was the real punishment, not the rate
sure, but hold 366 days and pay zero WAS the entire german strategy. that perk was the whole pitch for normies
The 366 day rule was the entire pitch for normal people, agreed. My accountant is going to miss it
offsetting crypto losses against stock gains is genuinely new. under the old rule my 2022 bags were pure decoration
watching korean and german regulators hit crypto in the same week while etf flows keep climbing is honestly a funny contrast. the tax man wants in, thats all this is
reminder this is still a draft circulating between ministries. the same coalition watered down softer finance bills in committee, hold the panic buys until the gesetzestext lands
hold the panic buys is right, but even a watered down version keeps the jan 2027 cutoff incentive. watch december 2026 volumes on german exchanges, it will be a zoo
december 2026 volume spike is guaranteed. question is whether german exchanges survive another kyc stampede at that scale
350 million a year explains everything. once the ministry put a revenue number on it the one year rule was living on borrowed time
350 million a year is the tell, agreed. No finance ministry walks away from a revenue line like that once it is written into a draft.
350M a year is couch money for a federal budget. the point of this draft is control of the asset class, full stop
350 million is also the optimistic number. wait until the working group realizes december 2026 front-running inflates the base and they revise it upward in committee
coins bought after jan 2027 pay from day one, so the december 2026 buy frenzy is basically free alpha hiding in a tax draft lol