Japan may see a reduction in the tax on income from cryptocurrencies
The new proposal provides for a separate 20% tax on crypto income and exemption from any tax on crypto income with loss transfer for up to three years. Now the income from investments in cryptocurrency is taxed in the country up to 55%.
The Japanese Crypto Asset Association (JCBA) and the Japanese Crypto Asset Exchange Association (JVCEA), two well-known cryptocurrency advocacy groups in Japan, have published a request for tax reform. Zaros calls for a reduction in taxes on income from cryptocurrencies for individual investors.
The request for tax reform for fiscal year 2023 concerns key issues that, according to human rights groups, hinder the introduction of cryptocurrencies in the country. The proposal focused on the need to improve the environment for filing individual tax returns, the importance of crypto assets in the Japanese web3 strategy and comparison with foreign systems of taxation of crypto assets.
The proposal provides for a separate tax of 20% for individual crypto investors with provisions for postponing losses for three years from next year. The proposal also calls for the application of the same tax structure in the crypto derivatives market.
A separate tax of 20% on crypto income with an exemption from unrealized profits will be a great relief for crypto investors in Japan, who are currently taxed up to 55% on income from their crypto investments.
The tax reform proposal came just a week after it became known about an internal memorandum on cryptocurrency tax reforms, which is to be submitted to the Financial Services Agency of Japan (FSA).
Japanese crypto groups are working to ensure that the crypto industry flourishes in the country, paying special attention to tax reforms. These crypto-lobbying groups believe that a high tax rate will make it more difficult for businesses and individual investors to own digital assets in Japan compared to more crypto-friendly countries.
Cryptocurrency taxes have been the focus of several governments around the world this year, with many countries introducing high tax rates, while others have moved to repeal or delay their introduction due to the lack of clear rules. In April of this year, India introduced a 30% tax on profits from cryptocurrencies, while Thailand canceled its proposal for a 15% tax on cryptocurrencies and even exempted traders from 7% VAT to encourage the introduction of cryptocurrencies in the country. Similarly, South Korea has postponed its proposed 20% tax policy on cryptocurrency until 2025.
https://coin-signal.com/cryptonews/japan-may-see-a-reduction-in-the-tax-on-income-from-cryptocurrencies/
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