Altcoins Talks - Cryptocurrency Forum
Learning & News => News related to Crypto => Topic started by: ABCbits on July 23, 2024, 01:29:46 PM
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Japan Blockchain Association Petitions for Crypto Tax Reform
Japanese crypto and blockchain firms are petitioning the government to reform the tax on cryptocurrencies.
According to an official Japan Blockchain Association (JBA) statement (https://prtimes.jp/main/html/rd/p/000000024.000081775.html), the companies claim that high tax rates on crypto profits are "hindering" the ability to save and invest.
JBA is thus calling on the government to use the same tax rate on crypto that currently applies to traditional assets such as stocks. Additionally, the body believes the current rules on crypto transactions are too complicated... Read more here (https://www.blockhead.co/2024/07/23/japan-blockchain-association-petitions-for-crypto-tax-reform/).
Up to 55% tax sounds very high, so it's not surprising they made this petition. Your opinion is greatly appreciated.
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It seemed to me for a long time that the Japanese authorities simply wanted to discourage ordinary people, and especially companies, from investing in cryptocurrencies - because the tax on stock trading is fixed at 20%. In addition, in Japan, companies that own cryptocurrencies pay even 30% tax only on the holding annually, which really does not make sense.
From the perspective of many other countries, Japan is really too strict with its citizens when it comes to taxes in general, but I wonder what their numbers would look like if that wasn't the case. I am referring, of course, to the fact that Japan is the country with the largest debt in the world, although it is true that this debt is mostly internal.
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JBA is thus calling on the government to use the same tax rate on crypto that currently applies to traditional assets such as stocks. Additionally, the body believes the current rules on crypto transactions are too complicated. Up to 55% tax sounds very high, so it's not surprising they made this petition.
I can see a huge potential of the cryptocurrency industry to explode in Japan but I agree that this high tax regime has become one of its top hindrances...imagine taking in 55% of tax and there is no way to avoid it. With strong push and support, I am hoping that the government is going to listen to this petition and make things more fair and competitive by at least lowering the tax according to the level imposed on other investment vehicles like stocks, for example. For me, it is a little bit shame that Japan is imposing this high tax considering the fact that we might consider Nakamoto Satoshi as Japanese even if it can just be pseudonym or the fact that one of the most popular and earliest crypto exchange MtGox was actually based in Japan.
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~snip~
For me, it is a little bit shame that Japan is imposing this high tax considering the fact that we might consider Nakamoto Satoshi as Japanese even if it can just be pseudonym or the fact that one of the most popular and earliest crypto exchange MtGox was actually based in Japan.
Hal Finney is one of the first people who had the opportunity to work with Satoshi, and in one of his posts he wrote the following :
Today, Satoshi's true identity has become a mystery. But at the time, I thought I was dealing with a young man of Japanese ancestry who was very smart and sincere. I've had the good fortune to know many brilliant people over the course of my life, so I recognize the signs.
It is possible that Satoshi was really Japanese (or someone of Japanese origin), but it is also possible that he came up with this trick to mislead everyone. As for Mt.Gox, maybe it would be better if that CEX never existed, because the damage it did to Bitcoin's reputation has not been repaired to this day.
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55% tax is a soft ban and not a tax. Buying and selling will stop and will be limited to long-term investment.
Services have already begun to leave the Japanese market, Gate.io is the last of them, but the reason is not taxes, but rather to comply with financial regulations.
https://decrypt.co/241132/gate-io-japanese-compliant-crypto-exchanges-exits-market
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I think it is important to think carefully if you want to have a tax that high. I agree that it is a deterrent to people who are probably trying to get into the market. With this in mind, I don’t think it will be easy to get Japanese people into the cryptocurrency space.
I’m looking to forward with other updates about this.
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In addition, in Japan, companies that own cryptocurrencies pay even 30% tax only on the holding annually, which really does not make sense.
Yeah, it doesn't make sense. And in past, it included unrealized holdings where the same association (along with other group) managed to change that.
55% tax is a soft ban and not a tax. Buying and selling will stop and will be limited to long-term investment.
Or rather, soft ban for those who plan to make lots of profit from cryptocurrency.
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Up to 55% tax sounds very high, so it's not surprising they made this petition. Your opinion is greatly appreciated.
If I'm not mistaken, it's realized tax? So unless you are not selling your crypto, you will not be tax correct?
However, the only way that I think of to get around that 55% tax could be getting out of the country of Japan and then sell before returning back. Not sure about the law, but it could be a year or 12 months. But you have to time yourself going out of the country. Again, not expert here, and I don't know if that is a viable option for Japanese.
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After reading the article, it is clear what their intentions are, tax crypto very high so that people are discouraged to hold or spend it. I would not be surprised if these complaints fall on deaf ears and the government sticks to their original tax rate on crypto, but if it continues like this, we are sure adoption of crypto in Japan will be stunted.
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The tax up to 55% is already bad enough but what makes it worse is that investors/traders are not allowed to deduct their losses in the same taxable year.
Up to 55% tax sounds very high, so it's not surprising they made this petition. Your opinion is greatly appreciated.
If I'm not mistaken, it's realized tax? So unless you are not selling your crypto, you will not be tax correct?
Yes, selling is one way to get taxed. From their tax rule, it expands to airdrops, mining, staking rewards, coins/tokens from forks, crypto lending, and even referral bonuses.
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~snip~
However, the only way that I think of to get around that 55% tax could be getting out of the country of Japan and then sell before returning back. Not sure about the law, but it could be a year or 12 months. But you have to time yourself going out of the country. Again, not expert here, and I don't know if that is a viable option for Japanese.
Somehow I don't think that's how things work in Japan, at least not for ordinary people. On the other hand, those who could be in a position to pay up to 55% of taxes will certainly find a way to avoid it - I think that rich people in every country very easily find ways to avoid paying taxes.
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It is possible that Satoshi was really Japanese (or someone of Japanese origin), but it is also possible that he came up with this trick to mislead everyone. As for Mt.Gox, maybe it would be better if that CEX never existed, because the damage it did to Bitcoin's reputation has not been repaired to this day.
I agree with your opinion about Mt.Gox and its very bad role in the history of Bitcoin and its bad reputation. Mt. Gox The Japanese at that time was the largest Bitcoin exchange in the world by 2013 and it handled more than 70% of all Bitcoin transactions at its peak, and the price of Bitcoin at that time rose to $1000, but the collapse of the Japanese exchange and its declaration of bankruptcy caused a major disaster for the market, the price fell by almost half, and a loss of confidence. In Bitcoin.
Its impact has been very bad and is extending so far that the news of compensation for those affected has once again caused the price to fall, so it is not a good thing for Japan.
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That is a way to keep people away from crypto, and its not really a hidden subtle thing anymore. When a nation fears a thing, but knows that they can't make it work, they just end up making sure that its highly taxed, so much so that it would not be profitable to deal with it, so that people would stop dealing with it, and can't blame the government because government didn't ban it. But this is already a known method and not really something they can stay behind. If there is a high tax on something, there is no need for it, and they can make the tax come down a bit, at least make humane enough to keep it profitable.