• Japanese finance minister, Taro Aso, said that he’s not willing to reduce the tax rate on crypto to 20%.
  • In Japan, crypto-related income is categorized as miscellaneous income on taxes, subject to a rate of up to 55%.
  • The country taxes stocks at a flat rate of 20%.

Japanese finance minister, Taro Aso, said that he’s not willing to reduce the tax rate on crypto in the country to 20% because it’s difficult for many households to invest in digital assets. He said this as a response to a question from Japan Restoration Association member Shun Otokita at a meeting of the House of Councillors Committee on Financial Affairs held recently. 

Out of 1900 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.

Although Japan is the birthplace of crypto, the country still has numerous cash-based businesses and individuals who keep their savings liquid. According to Aso, since it would be hard to convince investors in Japan to put their cash into crypto, the tax rate should stay as is. In Japan, almost all crypto-related income is categorized as miscellaneous income on taxes. As such, they are subject to a rate of up to 55%. However, the country taxes stocks at a flat rate of 20%. Pro-crypto legislators have been requesting the govt to treat crypto-related income the same as stocks.

Under the modifications to Japan’s existing legislation on cryptocurrencies, which went into effect May 1, the Payment Services Act (PSA) requires that all references to “virtual currency” be replaced with the term “crypto asset”. 

Otokita asked Japan’s Financial Services Agency (FSA) if it was appropriate to cut the leverage cap for cryptocurrency margin trading to 2x. The leverage limit was lowered from 4x in the same regulations, which took effect May 1. The agency claimed to have discussed the matter with crypto experts and FX insiders, taking public comments into account. According to the FSA, lowering the leverage cap was an appropriate response to the volatility of cryptocurrencies.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Cardano whales enter buying spree before the Vasil hard fork

Cardano whales enter buying spree before the Vasil hard fork

Cardano price is showing an interesting set up as it struggles to make a move above a crucial support level. A rejection here could lead to a buying opportunity for patient investors before ADA explodes.

More Cardano News

Why Dogecoin enters 50% bull rally despite founder’s remarks on Elon Musk

Why Dogecoin enters 50% bull rally despite founder’s remarks on Elon Musk

Dogecoin price has been coiling up like a spring for roughly ten days, indicating that a massive move is about to occur. The congestion will likely lead to a bullish move for DOGE that is brimming with volatility.

More Dogecoin News

SafeMoon price readies for a 40% breakout

SafeMoon price readies for a 40% breakout

A brief technical and on-chain analysis on SafeMoon price. Here, FXStreet's analysts evaluate where SFM could be heading next.

More SafeMoon News

Why a 20% rally for Crypto.com price makes sense now

Why a 20% rally for Crypto.com price makes sense now

Crypto.com price is on the verge of flipping a crucial resistance barrier into a support level. Assuming this conversion occurs, CRO will be primed for a quick expansion to the next hurdle.

More Crypto.com News

Bitcoin: The last rebound before capitulation

Bitcoin: The last rebound before capitulation

Bitcoin is showing bullish signs in the lower time frames, which can be taken advantage of by traders in the next couple of days. But looking at BTC from the higher time frames suggests that the bottom is not in yet.

Read full analysis

BTC

ETH

XRP