Reform UK proposes cutting crypto capital gains tax to 10%
Reform UK has proposed introducing a flat 10% capital gains tax rate on cryptocurrencies. The UK's 240 largest crypto investors alone could save more than £100 million a year under the measure.
According to The Independent, the basic capital gains tax rate currently stands at 18%, while higher-rate taxpayers pay 24%. Reform UK's plan would cut the rate to 10% for cryptocurrencies and qualifying digital assets while retaining the tax-free allowance.
According to the UK's tax authority HMRC, 17,600 crypto investors generated a combined £1.38 billion in capital gains in 2025. Of that amount, £717 million came from just 240 people who each made more than £1 million from digital assets.
Largest investors could save over £100 million a year
Analysts estimate that a 10% rate would allow those 240 investors to collectively reduce their tax bills by more than £100 million a year. Over a standard five-year parliamentary term, the savings could total around £500 million.
Reform UK argues that the lower rate would increase rather than reduce government revenue by bringing capital back to the UK, boosting transaction activity and improving tax compliance. The argument is included in the party's proposed Cryptoassets and Digital Finance Bill.
The proposal has drawn attention following large donations to the party from crypto-linked billionaires Christopher Harborne and Ben Delo. According to the cited source, each donated £36 million.
However, the materials cited do not establish a link between the donations and the tax proposal. Reform UK had previously published its plan to cut taxes on cryptocurrencies as part of its digital finance agenda.
Tax authorities expand crypto oversight
International reporting requirements for digital assets are also becoming stricter. Chainalysis estimates that potentially taxable onchain activity exceeded $457 billion in 2025.
However, the Crypto-Asset Reporting Framework currently covers around 14% of identified activity in practice. A significant share of DeFi transactions, P2P transfers and other onchain activity remains outside its practical scope.
Earlier, we reported that Germany is preparing to introduce a flat 25% tax on crypto gains and eliminate existing exemptions for many long-term investors. The proposed rules are expected to take effect in 2028 and apply to crypto assets acquired from January 1, 2027.
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