Japan Considers Cutting Crypto Tax Rate to 20% in Regulatory Reform

Japan's ruling Liberal Democratic Party (LDP) is proposing a significant regulatory reform that could slash the crypto tax rate from the current maximum of 55% to a flat 20%. Published on Thursday, the proposal aims to reclassify cryptocurrencies as financial products under the Financial Instruments and Exchange Act, similar to securities investments. This move, spearheaded by Akihisa Shiozaki, leader of the LDP's Web3 working group, seeks to foster market growth, protect investors, and introduce separate taxation for crypto gains. The LDP is collecting public feedback on the proposal until March 31 before submitting it to the Financial Services Agency. If passed, this could potentially pave the way for a spot crypto exchange-traded fund in Japan.