Japanese cryptocurrency advocacy groups will be calling on the government to ease corporate tax regulations, allowing the country’s digital asset industry to grow.
According at Bloombergthe Virtual and Crypto Assets Exchange Association (JVCEA) and the Cryptoasset Business Association (JCBA) are preparing to submit a proposal to the Financial Services Agency (FSA) asking it to reduce the costs of issuing and holding cryptocurrency tokens. currency for business.
Japan’s Web3 “brain drain” due to taxation
Currently, Japan levies a 30% corporate tax on digital assets, including unrealized gains. Lobby groups will push the government to suspend taxation of paper profits on cryptocurrency holdings if companies own them for reasons other than short-term trading, according to the document.
This is arguably done to reduce the drain of talent from the national crypto market and turn it into a lucrative hub for cash investments.
The groups want to reduce the current tax rate for individual investors by up to 55% to 30%.
In April, the operator of BitFlyer, one of Japan’s leading cryptocurrency exchanges, was bought by ACA Group, a Japanese private equity group with offices in Singapore, which is a low-tax jurisdiction.
“Japan is an impossible place to do business,” said Sota Watanabe, CEO of Web3 infrastructure developer Stake Technologies. Bloomberg.
“The global battle for Web3 hegemony is ongoing, and yet Japan is not even at the starting line,” Watanabe added.
With reports of Japanese Web3 companies switching bases, the proposal could be presented to authorities as early as this week, a JCBA official said.
Japan bets on the Web3
Earlier this month, the country’s Ministry of Economy, Trade and Industry (METI) established a Web3 political office to not only collaborate on the digital front but also to better understand the challenges of the sector.
“The Web3 Policy Office will collect information from business operators, investors, legal professionals, engineers and other parties regarding issues facing Japanese and overseas business environments and work with relevant government departments and agencies. to develop the Web3 business environment,” METI said. .
And one of Japan’s largest banks, Sumitomo Mitsui Banking Corporation (SMBC), also recently announcement its intention to move into the non-fungible token (NFT) and Web3 space.
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