Cryptocurrency issuers in Japan are now exempt from paying a 30% corporate tax on unrealized gains on tokens under a June 20 revision to the law by the National Tax Agency.
See related article: MUFG enables bank-backed stablecoin issuance amid new Japanese regulations
Fast facts
- The tax change comes as Japanese authorities push initiatives to promote its blockchain and crypto sector.
- Prime Minister Fumio Kishida supports digital finance and blockchain adoption in Japan to reinvigorate the economy in what he has more broadly called “new capitalism.”
- However, cryptocurrency investors are still subject to a maximum 55% income tax on crypto-related earnings over 200,000 Japanese yen (US$1,400) which is classified as “miscellaneous income.”
- Japan Virtual & Crypto Assets Exchange Association, the country’s lobby group for the crypto industry, is requesting regulators to also relax crypto margin trading limits, Bloomberg reported last week.
- Mitsubishi UFJ Financial Group Inc. (MUFG), the largest bank in Japan, is also reportedly in talks with various global cryptocurrency companies about issuing stablecoins.
- Earlier this month, MUFG announced details on its Progmat Coin blockchain-based platform to enable local banks to launch stablecoins and digital assets.
See related article: How Japan is illuminating the path of blockchain’s future: Opinion