By Nermeen Nabil Khear 
The Japanese Finance Minster Katsunobu Kato has promised Tokyo will review the nation’s controversial and much-maligned crypto tax laws by the end of June this year.
Per the House of Representatives’ official website and a report from the Japanese-language media outlet Iolite, Kato made the comments at a plenary session of the House of Representatives on the 31st.
Japanese Finance Minister: Regulators Readying Crypto Tax Review
Kato was responding to a question from the Liberal Democratic Party (LDP) lawmaker Akihisa Shiozaki, the head of the party’s Web3 Digital Society Promotion office.
Kato explained that the Financial Service Agency (FSA) will issue a review “based on the ruling party [LDP]’s tax system proposals.”
He added that the review would include recommendations on “necessary legislative amendments.”
Prime Minister Shigeru Ishiba also waded into the discussion by “expressing his belief that cryptoassets” would “contribute to solving Japan’s social problems and improving productivity.”
“The healthy development of web3 – including cryptoassets – is extremely important.”
Japanese Prime Minister Shigeru Ishiba
Ishiba added that it was “important” for the government to “ensure user protection” and “improve the environment” of the domestic crypto market.
Regulator’s Report Key
The minister said the FSA will also outline its proposed changes to the nation’s tax authorities.
This, Kato said, will ensure any necessary changes are “put in place” before the new rules roll out.
Kato also suggested that Tokyo is ready to change its legal definition of cryptoassets.
Existing Japanese law defines crypto as a type of “payment instrument.” But the minister said that “in reality” coins like Bitcoin (BTC) are “mainly traded for investment purposes.”
He added that the FSA has “indicated an intention” to “take in a wide range of opinions” before making an official recommendation “on the appropriateness of” crypto’s current “legal status.”
Since the FSA began policing the Japanese crypto market in earnest in 2017, the agency has had the last word on all related regulations.
The LDP, which has been in power on an almost uninterrupted basis since the 1950s, has formulated basic crypto policy. But it is the FSA that has formulated regulations and legal amendments.
Thus far, all of the FSA’s proposals and requests made to parliament on the matter have been adopted without delay.
PM’s Caution
Ishiba’s predecessor Fumio Kishida took a relatively progressive stance on crypto regulation.
Ishiba, however, has been more cautious on the matter of tax reform. But he has also made a number of more conciliatory comments about crypto and blockchain.
Shiozaki’s department has called for faster action, claiming late last year that its proposal to reform crypto tax was of “urgent” importance.
Japanese tax laws require crypto traders to report their profits on their yearly income tax returns.
This runs in contrast to many other countries, which impose flat capital gains levies on traders (at rates of around 20%).
Japanese traders must file their crypto trading profits on annual tax returns as “other income.”
This means that the wealthiest crypto traders in Japan must hand over up to 55% of their trading profits to the Treasury.
‘Unfair’ Tax Laws
Many critics and Japanese crypto investors claim the Japanese crypto market is over-regulated. This, they claim, has stifled growth in the web3 and crypto sectors.
The FSA, meanwhile, is also reportedly considering making an amendment to the Payment Services Act.
This measure could see crypto included as an asset class under the terms of the Financial Instruments and Exchange Act.
If true, this would appear to indicate that the FSA and the Japanese Finance Minster now share a common stance on reform.
The post Japanese Finance Minster: Tokyo Will Review Crypto Tax System ‘by June’ appeared first on Cryptonews.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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