Japan’s financial regulator calls for lower crypto tax by 2025
Japan's financial regulator has released plans for a comprehensive overhaul of its tax code for the 2025 fiscal year, which could lead to lower taxes on offerings for crypto assets.
In an August 30 tax reform inquiry, Japan's Financial Services Agency (FSA) highlighted crypto assets, pushing for them to be treated as traditional financial assets that can be invested by the public.
Source: MartiParty
“With regard to the tax treatment of cryptocurrency transactions, cryptocurrency should be treated as a financial asset that should be the target of public investment,” the FSA wrote.
“It is necessary to consider this case in terms of whether it should be treated as such.”
According to Crypto Accountant Token Tax, crypto profits in Japan are currently taxed between 15% and 55% as miscellaneous income.
A higher rate of 55% may apply to income above ¥200,000 ($1,377), but it varies depending on the individual's income tax bracket.
In comparison, profits from stock trading are subject to a maximum tax rate of only 20%.
Corporate crypto holders must pay a flat 30% tax rate on their holdings at the end of the fiscal year, even if they make no profit on the sale.
RELATED: Japan eyes corporate tax on non-crypto profits: Report
Government ministries submit requests for tax reform to the ruling party, which are then referred to the Tax System Research Committee and the country's national legislature.
The amendment becomes law only if it is approved by both houses of the Japanese government – the House of Representatives and the House of Representatives.
Crypto advocates want tax reform
In Japan, crypto industry advocates have been pushing for years to revise the national tax regime for digital assets.
The Japan Blockchain Association (JBA), a pro-crypto lobby group, has officially called on the government to lower the tax rate on crypto assets by 2023.
In July. In the year 19, the group proposed tax reform on crypto assets for the 2025 financial year to boost further growth in the country's crypto sector.
Among his proposals were a flat 20% tax rate for crypto and a three-year loss carryforward reduction.
Despite these efforts, the questions asked so far have ultimately failed to bring about any policy changes for the industry in Japan.
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