Japan is reviewing existing corporate tax rates related to crypto to help start-ups remain in the country.
The Japanese financial services agency (FSA) is working with the ministry of economy, trade and industry to come up with a tax reform proposal for next year that could enable an exemption for start-up companies from paying taxes on unrealized gains.
“The aim is to reduce the burden on newly established companies and prevent promising start-ups from flowing overseas”, local news outlet Yomiuri announced on Wednesday, August 24.
Currently, any start-up issuing its own token must pay tax on unrealized gains. This is due to company holdings being taxed based on the market value at the end of the taxation period.
The tax review seemed to be confirmed by Japanese lawmaker Taira Masaaki on Twitter, who wrote: “To review ‘crypto assets’ taxation … Consider the growth of emerging companies.”
Taxation has been a subject rife in Japan with investors currently taxed up to 55% on capital gains.
Earlier this month, two crypto groups in Japan, the Japan Crypto-Asset Exchange Association (JVCEA) and the Japan Crypto-Asset Business Association (JBCA) asked the government to lower the taxes on crypto and include a 20% capital gains for retail investors.
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