The National Tax Agency (NTA) in Japan has decided to exempt token issuers from paying a 30% corporate tax on paper gains from cryptocurrency, according to reports published on June 20.
This bold step is expected to enhance the growth and development of the cryptocurrency & blockchain industry within the country.
Traditionally, Japanese corporate entities have been subject to a 30% tax on paper gains made from cryptocurrency investments. This has been deemed a potential hindrance to the development of the sector, particularly given the volatile nature of cryptocurrency markets.
The Japan Virtual & Crypto Assets Exchange Association (JVCEA) has welcomed this move, along with major Japanese bank Mitsubishi UFJ Financial Group Inc. (MUFG), seeing it as an opportunity to encourage more innovation in the cryptocurrency space.
This decision comes as part of a broader initiative by the Japanese government, specifically the Liberal Democratic Party (LDP), to provide an environment conducive to the growth and development of digital asset industries.
The LDP has also been proactive in addressing the potential risks associated with cryptocurrencies, including implementing measures to comply with the Financial Action Task Force (FATF) and Anti-Money Laundering (AML) guidelines.
This latest decision by Japan’s National Tax Agency could spur significant growth in the country’s cryptocurrency market by reducing the financial pressures on token issuers. Japan continues to demonstrate its commitment to fostering a well-regulated and innovative cryptocurrency environment.