Japan to cut tax on unrealised profits for token issuers

The Tax Committee of the ruling Liberal Democratic Party of Japan approved a loosening of the tax burden on token issuers. Bloomberg reports.

The initiative would abolish the requirement for companies to pay taxes on unrealised gains from coins issued and held on balance sheets. The current rate stands at 30%.

The measure aims to spur growth in the financial and technology sectors. The existing rules have driven entrepreneurs to establish startups in other jurisdictions.

Parliament is expected to consider the tax-rule amendment in January 2023. If approved, it would take effect in the following fiscal year, which begins on 1 April.

In October, Prime Minister Fumio Kishida announced government investments to promote Web3-services, including metaverses and NFTs.

In the same month, JVCEA announced plans to ease rules governing the listing of digital assets for authorised trading platforms.

Earlier, in August 2022, proposals to exempt crypto startups issuing their own tokens from taxes on unrealised profits were put forward. The authors also proposed cutting the capital gains tax for retail investors from 55% to 20%.

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