Japan Considers Lowering Crypto Tax Rate to Unified 20% from Current 55%

[ABCbits]

Japan Considers Lowering Crypto Tax Rate to Unified 20% from Current 55%

Currently, Japan taxes cryptocurrency earnings under a miscellaneous income category.

Japan is considering a change to its crypto tax code, potentially lowering it to align with other financial assets.

The country’s financial regulator, the Financial Services Agency (FSA), has recently proposed a reform that could lower the tax rate on crypto profits to a flat 20%... Read more here.


Few months ago, it's known that Japan Blockchain Association (JBA) made petition to reduce tax which discussed here. And to be clear, cryptocurrency tax in Japan is up to 55% depending on how much someone earn. Your opinion is greatly appreciated.

[Zed0X]

I was wondering where the additional 10% is coming from since Japan only has 5% to 45% tax on miscellaneous income. I didn't know they have inhabitant taxes too. Anyway, the proposed 20% flat rate would benefit larger traders more than the minors/casuals. Currently, the latter are excused from paying taxes if their trading profit is less than 200K JPY.

[trendcoin]

These tax rates still seem too high to me. I haven't read the details of the news, but if I am exposed to these tax rates, I will become an anarchist in two days... :) Through this news, we understand that the relationship between decentralized systems and authorities is not always good. This will push us to trade in illegal ways from time to time. I don't think we owe anything to anyone except the commission paid to the stock exchange and the tax on that commission... :)

[Zed0X]

These tax rates still seem too high to me.

What are the rates in your country for personal income tax and capital gains? Other than the 10% additional tax as I said above, I think the rates currently imposed by Japan and the proposal is almost similar to a lot of countries

[MrSpasybo]

These tax rates still seem too high to me. I haven't read the details of the news, but if I am exposed to these tax rates, I will become an anarchist in two days... Through this news, we understand that the relationship between decentralized systems and authorities is not always good. This will push us to trade in illegal ways from time to time. I don't think we owe anything to anyone except the commission paid to the stock exchange and the tax on that commission...

Well, I’m also surprised by the 55% figure. That means if a crypto investor makes a $100K profit, they have to pay the government $55K, which is more than half of what they worked hard to earn through a lot of effort and time. Perhaps this tax revenue isn’t being used effectively to promote the development of crypto in this market because Japan is no longer considered a strong crypto market like it was in 2017.

At least the “greed” of the Japanese government has decreased, and perhaps 20% is a more appropriate tax rate. Personally, I hope that when my country’s government accepts crypto, the tax will be only about 0.1% as for stocks.

[Jating]

Perhaps it just shows how expensive to live in Japan to begin with, 55% income tax from just crypto alone? So it make sense for them to lower it to 20%, here in our country it's about 30%, so it's within the range.

And I guess it boils down on how much money you make before you can get on the 55% tax range.

But It's good if they are going to simply it, and will put a unified 20% across to ease crypto tax.

[erus]

55% for crypto tax is very high and it seems like it will make me poor if I live in Japan and trade crypto. I have something that I would probably avoid if I lived in Japan, which is trading crypto. Logically, if I have 1 Bitcoin that is converted to YEN and withdrawn to my personal account, then the net amount received to the account is only 0.45 BTC. This is really crazy in my opinion.

[TomPluz]

These tax rates still seem too high to me. I haven't read the details of the news, but if I am exposed to these tax rates, I will become an anarchist in two days... Through this news, we understand that the relationship between decentralized systems and authorities is not always good. This will push us to trade in illegal ways from time to time. I don't think we owe anything to anyone except the commission paid to the stock exchange and the tax on that commission...

As we know it, the government is doing all it can to extract money from the people in many ways than one...and here in cryptocurrency the government of Japan seemed to be unsure on what to do before and maybe right now they realized that they are actually burdening the many players who are doing the trading and investing. In countries where the government is on the top of many industries, people have no choice but to report and pay the taxes according to the approved rates. I am then glad that here in my country, we are still free to report or not to report. And you are right, sometimes it is good to think to defy the government but then we really don't know how powerful the government is on their locations. Still, this news is a good one but if they can lower more then it can be a celebration.

[target]

20% is still to much for anyone who is also paying for rent and feeding their kids. All I know is that the country has a high cost of living and and tax law like this makes the life uncomfortable.

They can only hope for more crypto adoption that their government be satisifed to reconsider lowering again.

[ABCbits]

I was wondering where the additional 10% is coming from since Japan only has 5% to 45% tax on miscellaneous income.

Looking at one of guide i found[1], the additional 10% refers to Municipal tax which always added, no matter how much you earn.

20% is still to much for anyone who is also paying for rent and feeding their kids.

But at least it's not much higher than tax for other form of currency or investment in Japan. The only concern with this consideration is people with low income would pay from 15% tax[1] to 20%.

[1] https://koinly.io/guides/crypto-tax-japan/

[kai]

I was wondering where the additional 10% is coming from since Japan only has 5% to 45% tax on miscellaneous income.

Looking at one of guide i found[1], the additional 10% refers to Municipal tax which always added, no matter how much you earn.

20% is still to much for anyone who is also paying for rent and feeding their kids.

But at least it's not much higher than tax for other form of currency or investment in Japan. The only concern with this consideration is people with low income would pay from 15% tax[1] to 20%.

[1] https://koinly.io/guides/crypto-tax-japan/

That means it's not just cryptocurrency in Japan that has a tax of more than 20%, I think if I lived in Japan I would feel very uncomfortable seeing such a huge tax.
For example, I have a job like buying and selling used cars, with a profit of around 10-20% but if you look at the tax in Japan it is 20% then my profit is only to pay the tax, oh my god this is too unreasonable for me to do business in Japan.

[yhiaali3]

Although the 20% tax on cryptocurrencies is still high, it is much better than 55%. I wonder why Japan imposes such a high tax on this sector? This high tax will make many resort to tax evasion or fraud to get rid of taxes.

Reducing the tax on cryptocurrencies from 55% to 20% is a great achievement for Japan if such a law is passed, as it will encourage individuals and institutions working in crypto in Japan and will prevent many cases of tax evasion due to the high tax.

[ABCbits]

Although the 20% tax on cryptocurrencies is still high, it is much better than 55%. I wonder why Japan imposes such a high tax on this sector? This high tax will make many resort to tax evasion or fraud to get rid of taxes.

I've seen some member speculate it's soft ban approach, to discourage people from investing/owning cryptocurrency without banning it.

[Rikafip]

Personally, I hope that when my country’s government accepts crypto, the tax will be only about 0.1% as for stocks.

You only have 0.1% tax for stocks? Whjere are you from, Dubai or something like that? 

Having said that, my country (Croatia) deals with crypto tax in the same way they deal with stock tax meaning 10% which is actually quite good when compared to majorify of other countries, and you can even avoid paying tax alltogether if you hold crypto for 2+ years.

[hugeblack]

In other words, if the law is passed, Japan will move from a voluntary ban on cryptocurrencies to accepting them, as 20%, although expensive, is still much less than 55% and may achieve profits in the bull market.