Japanese residents underpaid the treasury by about ¥1.4 billion (~$12.6 million), with half of the amount tied to Cardano (ADA) transactions. The results come from an audit, Nikkei reports.
An audit covered cryptocurrency investor accounts from several regions, including the highly urbanised Kanto region, which includes Tokyo, Saitama, Tochigi, Gunma, Niigata, and Nagano.
According to officials, traders are increasingly using crypto investments as tools to minimise taxes. The violations detected included failure to declare income, or deliberate attempts to conceal it.
The high share of ADA is explained by the asset’s rally since the start of the year of around 1,100%. At its peak the price rose above $3, and the rise amounted to over 1,600%.
Cardano’s popularity in Japan stems from the project’s initial focus on Asian markets during the ICO conducted between 2015 and 2017, the publication noted.
In August 2021, the local regulator allowed ADA trading on licensed platforms. Prior to that, investors could acquire the cryptocurrency only on overseas exchanges.
In Japan, cryptocurrencies are recognised as a legal form of payment and are taxable. The tax rate is variable and can reach 55% in some cases.
Earlier, the Financial Services Agency began discussing stricter rules for digital assets in order to protect investors.
In March, the Kanazawa District Court became the first to send a Bitcoin holder to prison for tax evasion.
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