Japan’s financial regulator has released a plan for a comprehensive tax code overhaul through 2025, including provisions to lower tax rates on crypto assets, Cointelegraph reported.
On August 30, the Financial Services Agency (FSA) of Japan emphasized in its tax reform request that crypto assets should be treated like traditional financial assets and become a target of public investment.
Currently, crypto profits in Japan are taxed as miscellaneous income at rates ranging from 15% to 55%, with the highest rate applying to gains over 200,000 yen. In comparison, stock trading profits are taxed at a maximum rate of only 20%.
Crypto assets held by businesses are subject to a flat tax rate of 30%, even if no profit is made from selling them.
Once a government department submits a tax reform request, it must be reviewed and approved by the ruling party, the Tax System Research Committee, and both houses of Congress before it can become law.
Crypto industry advocates such as the Japan Blockchain Association (JBA) have been pushing for digital asset tax reform for years, formally requesting the government to lower the tax rate on crypto assets in 2023, and submitted a 2025 tax reform request on July 19, proposing a 20% fixed tax rate on crypto assets and a three-year loss carryforward deduction.
Still, these requests have so far failed to bring about any policy changes.