Japan considering applying '20% separate taxation' to virtual asset trading income

The Japanese government is reportedly discussing switching income from virtual asset transactions, including Bitcoin, to be subject to a uniform tax rate of 20% under separate taxation.

On the 1st (local time), Japan's public broadcaster NHK reported that Japan's Financial Services Agency, considering the scale of more than 13 million virtual asset investment accounts, is examining a plan to treat virtual assets under the same system as general financial products such as stocks and bonds. Accordingly, the government and ruling party are reportedly discussing a plan to shift income from virtual asset transactions from the existing comprehensive taxation to separate taxation in next year's tax reform.

Currently in Japan, income from virtual asset transactions is combined with wages and other income and is subject to a maximum tax rate of 55%. The government plans to finalize the scope of virtual assets to be classified as financial products and the specific criteria during next year's tax reform.