Japanese Government Discusses A Simplified Cryptocurrency Tax Filing Procedure

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October 18, 2018 by
Japanese Government Discusses A Simplified Cryptocurrency Tax Filing Procedure

The government of Japan, through its Tax Commission is considering ways of simplifying the current tax filing system for cryptocurrencies as reported by local publication Sankei.

The exercise is expected to enable investors to accurately report their gains in their cryptocurrency ventures. The new system will be designed to standardize the filing process and introduce a simpler format for investors to calculate their profits on the sales of digital assets.

Given the varying prices of cryptocurrencies across exchanges, the current system of determining due taxes are reported to be cumbersome. Hence, in the Oct.17 meeting, the Tax Commission which is responsible for such policies and also to advise the prime minister discussed modifications that will improve the process.

Unlike neighbouring China and India, Japan is known to be more accommodative to cryptocurrency activities. Therefore finding effective processes that will facilitate proper declarations will indeed provide even more stabilization to its local digital assets ecosystem.

Decisions over the tax policies are however not yet finalized, as the president of the Tax Committee, Minoru Nakazato hinted on plans for future a meeting with experts.

“Since it is necessary to take into consideration frameworks other than the taxation system and business practices, we will hold a small meeting of experts to deepen the discussion while listening to outside opinions”, said Nakazato

A finalized policy will be expected to harmonize all tax processes within the jurisdiction. The existing system classifies profits from sales of cryptocurrencies under “miscellaneous income”. This classification runs on a tax rate that ranges between 15 to 55 percent depending on the actual amount of gains above 200,000 Yens per year.

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