Cryptocurrency issuers in Japan are now exempt from paying a 30% corporate tax on unrealized gains on tokens under a June 20 revision to the law by the National Tax Agency.
The tax change comes as Japanese authorities push initiatives to promote its blockchain and crypto sector.
Prime Minister Fumio Kishida supports digital finance and blockchain adoption in Japan to reinvigorate the economy in what he has more broadly called “new capitalism.”
However, cryptocurrency investors are still subject to a maximum 55% income tax on crypto-related earnings over 200,000 Japanese yen (US$1,400) which is classified as “miscellaneous income.”
Japan Virtual & Crypto Assets Exchange Association, the country’s lobby group for the crypto industry, is requesting regulators to also relax crypto margin trading limits, Bloomberg reported last week.
Mitsubishi UFJ Financial Group Inc. (MUFG), the largest bank in Japan, is also reportedly in talks with various global cryptocurrency companies about issuing stablecoins.
Earlier this month, MUFG announced details on its Progmat Coin blockchain-based platform to enable local banks to launch stablecoins and digital assets.