"Japan plans to replace progressive crypto tax rates up to 55% with a flat 20% by fiscal year 2026. New rules will align digital assets with equities, adding safeguards against insider trading and unfair practices. Investors will gain three-year loss carry-forward provisions, which ease volatility and improve portfolio risk management. Japan shifts from strict post-hack regulations to a Web3-friendly framework that balances innovation with security."
"Currently, investors must deal with a stringent system that taxes crypto transactions at steep rates up to 55%. This policy has discouraged participation, driven many traders out of Japan and left crypto disadvantaged compared to stocks taxed at a flat 20%. However, the ruling Liberal Democratic Party (LDP) in Japan has committed to reforms that would introduce a more favorable flat tax rate for crypto. This could potentially transform Japan's position as a global hub for digital assets."
Japan will replace progressive cryptocurrency tax rates as high as 55% with a flat 20% rate targeted for the fiscal year 2026, pending parliamentary approval. The new rules will align digital assets with equities and introduce insider-trading safeguards to prevent unfair profits from private information such as token listings or protocol changes. Investors will be allowed three-year loss carry-forward provisions to offset volatility and improve portfolio risk management. The regulatory approach will shift from strict post-hack rules to a Web3-friendly framework that balances innovation with security, aiming to make Japan more competitive as a global digital-asset hub.
Read at cointelegraph.com
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