Japan’s DPP Party Head Proposes Crypto Tax Cuts, Regulatory Reforms

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Sujha Sundararajan

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Sujha Sundararajan

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Last updated:

October 21, 2024 02:25 EDT

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Yuichiro Tamaki, the Leader of the opposition Democratic Party for the People (DPP), pledged for crypto tax reform, if elected. In his Tweet on Sunday, he proposed clear tax cuts and regulatory framework for digital assets in Japan.

“If you think crypto assets should be taxed separately at 20% instead of treated as miscellaneous income, please vote for the Democratic Party for the People,” he urged the citizens.

“There will be no tax when exchanging crypto assets with other crypto assets.”

Tamaki’s proposal, titled “supporting the token economy using crypto assets,” aims to promote an economy that utilises Web3 and NFTs.

Additionally, the DPP party’s pledge includes increasing the leverage ratio from 2x to 10x and introducing crypto ETFs in Japan.

This is not the first time DPP leader Tamaki called for a change in crypto tax law. Last year, he wrote that the government needed to “promote Web3” and “the token economy” and indicated that his party wanted to “tax cryptocurrencies” at a flat rate of 20%.

He also emphasised the need to act now in order to “prevent the outflow of human resources and businesses overseas.”

Several Japanese MPs, including Shun Otokita of the Japan Innovation Party, have urged Tokyo to modify its crypto tax laws. Additionally, private sector groups have attempted to challenge the government directly to reform the rate of crypto taxes.

Other Japanese Political Parties Show Interest to Remove Crypto Taxes

The ruling Liberal Democratic Party (LDP) has also indicated to cut tax-related hurdles on Web3. The ruling party launched an NFT policy task force, officially entitled the “NFT Policy Review Project Team.”

An LDP MP issued a “white paper” last year, explaining that Japan must “drive innovation in the Web 3.0 era.” Doing so will require the government to earmark the domestic NFT sector as a new growth engine, the MP added.

Furthermore, Tamaki’s proposal included converting the yen into an electronic currency and promote the issuance of digital local currency (CBDC).