Japan's New Digital Transformation Minister Hints at Cryptocurrency Tax Reform
Date: 2024-10-04 Author: Oliver Abernathy Categories: IN WORLD
Masaaki Taira, Japan's newly appointed digital transformation minister, has made it clear that he intends to push for cryptocurrency tax reform. During a press conference following his appointment, he called for tax law changes to support the blockchain sector.
Moving Toward Cryptocurrency Tax Reform
According to CoinPost, Taira was asked by reporters what kind of deregulation could help the development of blockchain technology. The minister noted that the main issue is the tax system. However, he also clarified that tax issues are not within his purview and cannot comment on this matter. However, Taira added that as a cabinet member and digital transformation minister, he is willing to discuss how the use of blockchain can affect the economy and financial situation in Japan.
Taira’s speech comes shortly after his appointment by Prime Minister Shigeru Ishiba, who is also the leader of Japan’s ruling Liberal Democratic Party. Ishiba has recently voiced his support for blockchain technology and NFTs, which could play a key role in the development of the country’s cryptocurrency sector.
Tax reform and crypto startups
Taira’s appointment is seen as a positive step for Japan’s cryptocurrency sector. He previously led the Liberal Democratic Party’s Web3 task force and has spoken out about the need to reform the tax system to support crypto startups. Taira has also stressed that current tax rules are not suitable for companies issuing and holding tokens less well-known than Bitcoin, as accounting firms cannot properly audit such companies.
Many critics argue that strict tax rules have forced Japanese crypto startups to move overseas, leading to a brain drain and capital drain. Until recently, companies holding tokens were required to pay taxes on unrealized profits, which is different from most other countries where taxes are levied only after the cryptocurrency is sold for fiat.
The Future of Blockchain and NFTs in Japan
Taira also spoke about the potential of NFTs and blockchain for Japan’s economic growth. Although the NFT-based digital art market is currently in decline, he believes that there are many other ways to use these technologies to unlock the country’s economic potential. In particular, he expressed hope for the video game sector to further develop into Web3, and also highlighted the possible economic changes with the advent of stablecoins and the metaverse.
Meanwhile, Japan’s Financial Services Agency is considering revising not only tax rules for companies, but also for individual cryptocurrency traders. Experts in Japan have long criticized the overregulation of the cryptocurrency sector, calling on the government to provide support for its growth.
