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Japanese cabinet approves crypto tax reform in 2024 fiscal plan

Press Releases Crypto News Crypto-News Japanese cabinet approves crypto tax reform in 2024 fiscal plan

The Japanese government has approved an amendment to the taxation of companies holding third-party-issued cryptocurrencies in its fiscal 2024 tax reform plan.

According to local news sources, the alteration to the taxation of firms holding third-party-issued cryptocurrencies means that such companies will no longer be subjected to the year-end mark-to-market valuation tax.

The Japanese Cabinet meeting approved the tax reform outline for fiscal year 2024. Companies holding crypto assets will no longer need to levy market value tax, and will only be taxed on profits generated by the sale of cryptocurrencies by relevant companies.…

— Wu Blockchain (@WuBlockchain) December 24, 2023

Before this amendment, corporations holding third-party-issued cryptocurrencies were required to record profits or losses based on the disparity between market value and book value at the end of the fiscal year.

Under the new reform, assets assumed to be held continuously will be exempted from this mark-to-market valuation.

This shift in policy means that companies will now be taxed solely on profits arising from the sale of digital currencies and tokens. The goal is to align the corporate tax system with the tax system applicable to individual investors.

Reports recently emerged that lawmakers from the country’s Liberal Democratic Party and their coalition partner Komeito were considering a proposal to exempt corporations from taxes on crypto gains that are not yet realized.

Analysts in the region saw it as Japan’s attempt to inject more liquidity into the market, aligning itself with other Asian regions making
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Author: Julius Mutunkei

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