Japan's Financial Agency Proposes Crypto Tax Reform

Japan’s Financial Services Agency (FSA) is taking the initiative to regulate cryptocurrencies and has proposed significant changes to the country’s tax code related to digital assets. The proposal, submitted on August 31st, outlines several key revisions aimed at fostering a more favorable environment for the promotion of Web3 technology and supporting blockchain-based startups. One of the most noteworthy proposals in the 16-page document is the elimination of the year-end “unrealized gains” tax on crypto for domestic firms.
 
Under the current taxation framework in Japan, legal entities are subject to taxes on their crypto assets each year, regardless of whether these assets have been converted into fiat currency. However, the FSA aims to change this by exempting domestic firms from this tax burden. This proposed amendment carries significant potential, as the FSA has received support from the Ministry of Economy, Trade, and Industry for its initiative. The collaboration between these two entities highlights the seriousness of Japan’s intent to reshape its crypto regulations.


Source: Cryptopolitan