Japan proposes crypto tax breaks to invigorate economy

In an effort to reinvigorate the Japanese economy, regulators are proposing to ease tax rules on cryptocurrencies.

Japanese regulator’s proposal

Prime Minister Fumio Kishida wants to boost the third-largest economy in the world, and to that end Japan’s financial regulator, the Financial Services Agency (FSA), is proposing a program that will give tax breaks to individual investors.

The proposal fits in with Kishida’s “New Capitalism” vision, in which he wants to double the wealth of households, while at the same time he seeks to increase the support for Japan’s Web3 economy.

What proposal entails

According to Bloomberg, the FSA wants to enlarge upon a tax break initiative called the Nippon Individual Savings Account (NISA). The move would entail the raising of investment limits and would mean investors would have some of their gains and dividends exempt from capital gains over a certain period. 

A country of savers

The Japanese are a country of savers, and this initiative is an effort to try and persuade individuals to put their savings into stock investments and by so doing give a boost to the economy.

Data from the Bank of Japan shows that Japanese households hold around half of their estimated 2 quadrillion yen ($14.5 trillion) in cash and deposits.

Crypto lobbyists

Last month, two of the top crypto lobbying organisations, the Japan Virtual and Crypto Assets Exchange Association, and the Japan Crypto Asset Business Association, sent a proposal to the FSA which would have it lower crypto taxes and encourage domestic businesses that deal in digital assets.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.