Overview
- The blueprint would replace today’s miscellaneous income treatment with a flat 20% rate for gains only on “specified crypto assets” handled by firms registered under the Financial Instruments framework.
- Japan’s current approach can push crypto taxes to roughly 55%, a burden policymakers say has discouraged domestic trading and long-term holding.
- The plan introduces a three-year carryforward of crypto trading losses starting in 2026, bringing treatment closer to equities and investment trusts.
- Legal changes would permit crypto within investment trusts, and Japan has already launched its first XRP ETF, with additional crypto-linked funds under consideration.
- Key details remain unsettled, including which tokens will qualify, the requirements for business registration, and the timetable for Diet approval that would determine when rules take effect.