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Japan To Slap Up To 55% Tax On Cryptocurrency Profits

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The Japanese government, which has been most supportive to crypto currencies, is now looking to make some additional revenue by taxing profits made by individuals through cryptocurrency dealings.

The National Tax Agency, which classified capital gains made from cryptocurrency dealings as 'miscellaneous income' last year, has asked individual investors to declare their profits in the annual tax returns filing due between February 16 and March 15.

Profits can include those from sales, trading, purchasing goods with cryptocurrencies, mining, and network forks.

The agency reportedly plans to tax such profits in the range of 15 to 55 percent, which is much steep than the roughly 20 percent levied on profits from stock and foreign currency trading. The higher tax rate is imposed on those who earn more than 40 million yen or $365 thousand dollars a year.

Around 40 percent of all Bitcoin trade has been against the Japanese Yen, Bloomberg reported.

Some of the wealthy Japanese crypto currency investors are already looking for safer havens to move to tax-free countries such as Singapore.

Japan is not alone in imposing tax on the huge profits made from virtual currency trading. In the US, tax authorities had announced that they will tax cryptocurrencies in the same tax bracket as gold and real estate, way back in 2014.

South Korea, another star playing field for cryptocurrencies, also decided to tax digital currency exchanges at a rate of 24.2 percent, in line with the tax policy for local corporations.

Further, the Japanese tax agency is creating a database focused on cryptocurrency investors, with a close watch of cryptocurrency trading.

The latest step by the Japanese government could be a significant source of revenue as cryptocurrency prices have surged in recent months.

by RTTNews Staff Writer

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