Cryptocurrency millionaires officially identified in Japan

Mainstream South Korean and Japanese media outlets JoongAng and Nikkei reported that Japan's National Tax Agency (NTA) is aware of 331 investors in the Japanese cryptocurrency sector who have reported $1 million or more in trading profits, earning a total of more than $331 million.

By the end of 2017, the NTA reported 21.98 million Japanese who declared a total of more than 41.4 billion yen. According to the NTA, the number of taxes collected increased by 3% compared to 2016, mainly due to the country's economic growth.

Of the twenty-two million people who filed tax returns, 549 individuals recorded indirect income of $1 million, which is often associated with activities in the stock, asset and real estate markets. Of the 549 people, 331 are cryptocurrency investors who have earned more than $1 million in the Japanese digital currency market.

In 2017, the Japanese government, the Financial Services Agency (FSA) and the NTA announced that investment profits would be subject to a 55% tax by local financial authorities.

However, Japanese regulators have not provided clarity on the issue of cryptocurrency taxation policy, and investors have acknowledged the lack of stability of the digital market currencies.

“The government has not shared details of possible taxation, so we do not have any verified information,” said blockchain technology consultant Hiroyuki Kamiya.

In regions such as the United States, tax agencies and local financial departments have previously subjected such audits to Companies like Coinbase and othersto be able to collect taxes from cryptocurrency investors. Despite this, Japan's NTA reported 331 investors filing taxes on cryptocurrency activities, and the agency is optimistic about voluntary declaration of cryptocurrency income.

Will South Korea follow suit?

Last year The South Korean governmenthas banned its citizens from investing in domestic ICOs to “minimize risks.” However, this year, following announcements by Kakao and Bithumb that they were going to hold ICOs outside of South Korea, local governments announced their intentions to legalize ICOs after introduction of appropriate taxation standards..

"The South Korean government had no choice but to follow the regulatory trends set by other leading governments. Although cryptocurrencies still have a negative reputation, the government's position is to allow what must be allowed for the sake of the prosperity of the South Korean market," said a South Korean government spokesman.

South Korea is likely to soon follow Japan's example by introducing a system voluntary declaration and will help cryptocurrency investors correctly show their income to the government. 

According to ccn