The Blockchain Association, which represents Japan’s largest cryptocurrency firms, has submitted a list of requests to the Japanese government.
Companies and organisations in Japan’s cryptocurrency sector have come together to form the Japan Blockchain Association (JBA), which has petitioned the government to change the country’s taxation structure for crypto assets.
JBA contends that these alterations will pave the way for more participation by both individuals and corporations in the rapidly expanding Web3 economy. The Japan Business Association also says these changes would boost tax receipts and establish Japan as a leading Web3 nation.
Those who own tokens issued by a third party, such as those found on DeFi and NFT (non-fungible token) platforms, are hit especially hard by the present tax structure, says JBA.
Unrealized gains tax applies to these tokens at the end of the year, so holders must report and pay tax on any appreciation in value regardless of whether or not they sell their tokens.
According to JBA, this discourages domestic firms from joining the Web3 sector by forcing them to sell tokens to cover tax obligations, which might lead to a drop in token value and slow the development of the token-based economy.
For individual crypto-asset dealers, who must pay income tax at varying rates based on income level and kind of transaction, the existing tax structure is unjust and confusing, according to JBA.
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