Japan’s ruling political party has introduced a new proposal that could dramatically alter the country’s stance on cryptocurrency taxation, with plans to lower the current tax rate from a hefty 55% to just 20%.
This initiative is still in its early stages, with feedback being gathered from the public before a final draft is submitted. The proposed changes would reclassify cryptocurrencies, moving them from their current categorization under the Payment Services Act to being treated as financial products under the Financial Instruments and Exchange Act. This shift would not only lower taxes on crypto-related profits but also align them with the tax structure used for traditional securities investments.
Akihisa Shiozaki, a prominent member of Japan’s House of Representatives, is leading the push, emphasizing that this proposal is designed to stimulate the market, enhance investor protection, and create a more defined tax framework for crypto gains. Additionally, Shiozaki suggested that this move could pave the way for the introduction of spot crypto ETFs in Japan.
READ MORE:
Mt. Gox Moves 12,000 BTC Amid Ongoing Repayment Uncertainty
At present, Japan imposes high taxes on cryptocurrency earnings, categorizing them as miscellaneous income, but the government has recently revised some tax policies. A major change, introduced in December, provides exemptions for corporations that hold their crypto assets long-term, allowing them to bypass taxes on unrealized gains. Industry leaders are optimistic about these developments, with Sota Watanabe, CEO of Startale, applauding the government’s efforts to collaborate with crypto stakeholders and encouraging further reforms.
The proposal is currently open for public commentary until March 31, after which it will be forwarded to the Financial Services Agency (FSA) for further review. Japan’s FSA has already indicated that it will provide additional regulatory guidance on crypto matters by June.
C0323492922
