New Japanese tax policy: tax cuts on Bitcoin and cryptocurrencies to attract investors.
On March 10, the Japanese government officially announced a reduction in the capital gains tax on Bitcoin and other cryptocurrencies, lowering the rate from 55% to 20%. This move marks a shift in the country’s fiscal policy towards digital assets.
According to LDP lawmaker Akira Shiizaki (Akihisa), cryptocurrencies will be classified as a new asset class, separate from securities under the Financial Instruments and Exchange Act. The new law stipulates that cryptocurrency derivatives trading will be taxed like spot investments, and taxes on crypto-to-crypto swaps will be deferred, applying them only when cryptocurrencies are converted into fiat currency.
The decision by the ruling Liberal Democracy Party is part of a broader reform plan for the digital asset sector, aimed at revitalizing Japan’s ecosystem and attracting both domestic and international investors.
The previous tax rate, one of the highest in the world, had driven many Japanese traders and investors to seek solutions abroad or reduce their activities in the digital asset market. With the new 20% tax rate, Japan is aligning more with international standards, creating a more favorable environment for innovation in the sector.
