The Japanese government greenlighted a bill to exempt local cryptocurrency issuers from paying corporate tax on their holdings.
The ruling body currently requires such firms to pay 30% on their ownings even if they haven’t gained profits through a sale.
Japan’s ruling political party – The Liberal Democratic Party – aims to ease corporate tax legislation for domestic crypto issuers and thus stimulate such entities to operate in their homeland.
Akihisa Shiozaki – an LDP lawkamer – described the move as a “very big step forward.”
“It will become easier for various companies to do business that involves issuing tokens,” he added.
Prime Minister Fumio Kishida’s cabinet is expected to complete its annual taxation standards by the end of 2022 based on the Liberal Democratic Party’s decisions.
The relaxed rules could come into force as of April 1, 2023 (the start of the new fiscal year in Japan).
Local lobbying groups have previously urged Japanese lawmakers to stop taxing paper gains on crypto holdings and thus cease the talent exodus.
High taxes have proved to be burdensome for numerous domestic startups, many of which have relocated to countries with friendlier regulations, such as Singapore.
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