Japan’s Prime Minister Shigeru Ishiba says the development of crypto assets and web3 is ‘extremely important’ for solving the nation’s problems.
According to Japanese media outlet Iolite, Finance Minister Katsunobu Kato has vowed to finalize Japan’s crypto tax rate by “the end of June this year,” in response to a question posed by the Liberal Democratic Party’s Head of Web3, Akihisa Shiozaki.
Shiozaki questioned the Japanese government’s stance on cryptocurrency, as he views ongoing discussions for Japan’s crypto tax rate is “much stricter” compared to other countries which have focused more passing crypto-friendly regulations to accommodate innovation in the digital finance sphere.
“Japan’s crypto asset tax system is stricter than other countries, which is hindering Japan’s competitiveness,” said Shiozaki, pointing out President Trump’s plan to establish a national Bitcoin (BTC) reserve in the U.S.
Japan Prime Minister, Shigeru Ishiba, responded to Shiozaki, stating that the he believes cryptocurrency will play a key role in solving Japan’s social and financial problems, as well as boosting the nation’s productivity. He also emphasized the importance of protecting crypto users and improving the web3 environment.
“The healthy development of Web 3.0, including crypto assets, is extremely important,” said Ishiba at the House of Representatives Budget Committee.
Japan’s crypto tax to be finalized by June 2025
Finance Minister Katsunobu Kato confirmed that financial regulators are in the process of discussing the 2025 crypto tax reform and are currently considering various “necessary legal arrangements.”
“The Financial Services Agency will verify the system regarding crypto assets by June of this year,” he said.
In December 2024, just before the announcement of the tax reform outline for fiscal 2025, the Liberal Democratic Party Policy Research Council green lit the “Urgent Proposal for Making Cryptocurrency an Asset that Contributes to the National Economy.”
The draft proposal included a bill that would apply a separate crypto tax on reported profits and losses from cryptocurrency transactions.
Under Japan’s current regulations, crypto falls under “miscellaneous income” which means Japan’s crypto tax could reach up to 55% depending on personal income. Meanwhile in October 2024, the Democratic Party for the People pushed for cutting the crypto tax to as low as 20%.
In addition, Kato said that the council is also mulling a change in how crypto assets are legally defined. In Japan, crypto assets are seen as a means of payment, instead of investment assets. Kato said that regulators are currently receiving input from various stakeholders on the matter.
