Japan will introduce a single tax rate on profits from cryptocurrency transactions

Japanese Deputy Prime Minister Taro Aso has proposed establishing a general tax rate for all cryptocurrency transactions.

Currently in Japan, profits from cryptocurrency transactions are classified as “miscellaneous financial income.” Different rates apply to different types of transactions. There are seven progressive tax rates, ranging from 5 to 45 percent of profits. Local governments also levy a 10% tax on “resident income.”

Aso has proposed setting cryptocurrency transactions at the same tax rate as any stock exchange income, namely 20% of profits.

According to the Policy Research Institute of the Japanese Ministry of Finance, profits from the sale of certain securities (including stocks, corporate interests, bonds with a stock option, etc.) are taxed separately from other sources of income at a flat rate 20.315 percent (i.e. 15.315 percent national tax and 5 percent resident income tax).

This regulatory decision may be related to the collective statement of the Japanese cryptocurrency trading community, which was filed on Change.org and called on the National Tax Agency (NTA) to change the unjustified policy of taxing cryptocurrency activities.

Japan is the most cryptocurrency-friendly of the economies. More than 3.5 million people in Japan trade cryptocurrency. The Japanese yen has gained a competitive advantage over other national currencies in accepting bitcoin and has allowed cryptocurrency exchanges to flourish, according to a report by the Japan Financial Services Agency (FSA).

According to rttnews.com