Finance minister of Japan opposes plan to cut crypto taxes

01 July

Taro Aso, Japan’s finance minister, said he’s not willing to go through lowering the tax rate on cryptocurrencies in the country. According to the tax legislation, cryptocurrencies should be offered at 20% so people from regular households can also try their hand at investing digital assets.  Taro Aso said there is no need to cut […]

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Taro Aso, Japan’s finance minister, said he’s not willing to go through lowering the tax rate on cryptocurrencies in the country. According to the tax legislation, cryptocurrencies should be offered at 20% so people from regular households can also try their hand at investing digital assets. 

Taro Aso said there is no need to cut the taxes as household investors are still not ready for cryptocurrency investments. 

‘Out of 1,900 trillion yen [17.6 billion USD] financial assets held by households in Japan, around 900 trillion yen [8.4 billion USD] is now being held as cash deposits and that is abnormal’, said the finance minister.

Japan is one of the leading countries in Southeast Asia that is actively adopting digital assets in their economy. The Japanese finance minister believes lowering the tax on digital currencies circulating the country can hurt Japan’s chances of attracting crypto investors that can help boost the crypto economy. He strongly believes it’s not necessary to adjust the rates of crypto taxes. 

Currently, all the incomes generated by cryptocurrencies in Japan such as trading, mining, and lending are labelled as ‘miscellaneous income’. These exchanges are subjected to taxes that can go as high as 55%. 

Additionally, the recent hearing on crypto tax cuts also included the suggestion that all ‘virtual currency’ references in the country should be substituted with ‘crypto assets’. Moreover, the PSA or the Payment Services Act also said that the cryptocurrency margin trading leverage cap should be lowered to 2x from 4x. 

During the committee hearing on Tuesday, the FSA or Financial Services Agency was asked if their agreement to decrease the leverage cap without further discussion was appropriate. They said the issue was brought up to cryptocurrency experts and FX insiders before they made a decision. They also said that their decision was deemed appropriate due to crypto’s volatile nature. 

Words by Rain Quintana

READ MORE: Japan Crypto and Casino News

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