The Japanese government greenlighted a bill to exempt local cryptocurrency issuers from paying corporate tax on their holdings.
The ruling body currently requires such firms to pay 30% on their ownings even if they haven’t gained profits through a sale.
- Japan’s ruling political party – The Liberal Democratic Party – aims to ease corporate tax legislation for domestic crypto issuers and thus stimulate such entities to operate in their homeland.
- Akihisa Shiozaki – an LDP lawkamer – described the move as a “very big step forward.”
“It will become easier for various companies to do business that involves issuing tokens,” he added.
- Prime Minister Fumio Kishida’s cabinet is expected to complete its annual taxation standards by the end of 2022 based on the Liberal Democratic Party’s decisions.
- The relaxed rules could come into force as of April 1, 2023 (the start of the new fiscal year in Japan).
- Local lobbying groups have previously urged Japanese lawmakers to stop taxing paper gains on crypto holdings and thus cease the talent exodus.
- High taxes have proved to be burdensome for numerous domestic startups, many of which have relocated to countries with friendlier regulations, such as Singapore.