June 2 2020 | AtoZ Markets – The Japan Finance Minister Taro Aso opined that he is opposed to lowering the tax rate on cryptocurrencies in Japan to a flat 20%.
Why is the Japanese Finance Minister unwilling to lower crypto taxes?
In response to a question from Japan Restoration Association member Shun Otokita at a meeting of the House of Councillors Committee on Financial Affairs, which convened on June 2, the Finance Minister clarified he is unwilling to push for lower taxes on crypto. He reasoned that it’s difficult for many households to invest in cryptocurrencies.
Aso also said that about 900 trillion yen is held as cash deposits out of 1900 trillion yen financial assets held by households in the country. This, according to him is abnormal.
The Finance Minister claimed that it would be difficult to convince investors in Japan to put their funds into crypto, so the tax rate need not be adjusted. In Japan, nearly all crypto-related incomes, whether it is from trading, mining, or lending is classified as miscellaneous income on taxes and are subject to a rate of up to 55%.
However, the country taxes stocks at a flat rate of 20%, something pro-crypto legislators have been pushing to include digital currency.
Read also: South Korea Proposes Low Level Crypto Income Tax
Two-third of crypto users support paying crypto tax
A recent survey conducted by wallet provider Childly found that 66% of respondents favor taxing cryptocurrencies. The survey included more than 5,750 crypto users worldwide, and only one-in-five crypto users are opposed to digital asset taxation. The survey hinted that the crypto community has no issues with taxing cryptocurrencies as long as it is fair. Only 20% of the polled crypto users disagree with taxing cryptocurrencies at present, and 9% of surveyed crypto users think its too early to tax crypto.
New changes to Japan’s existing legislation on cryptocurrencies, which went into effect last month, the Payment Services Act (PSA) requires that all references to “virtual currency” be replaced with the term “crypto asset.”
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