Japanese Cabinet Finalizes Outline of Tax Reform, Plans to Eliminate Taxation on Unrealized Gains from Cryptocurrencies for Businesses.

Japanese Cabinet Finalizes Outline of Tax Reform, Plans to Eliminate Taxation on Unrealized Gains from Cryptocurrencies for Businesses.

Japanese Cabinet Finalizes Outline of Tax Reform, Plans to Eliminate Taxation on Unrealized Gains from Cryptocurrencies for Businesses.

According to the report by Japanese media CoinPost, after the Japanese Cabinet approved the revision of the digital asset taxation system, Japanese companies will no longer be required to pay taxes on the “unrealized gains” of their cryptocurrency holdings starting from April next year.

The Japanese government announced the new tax reform outline after the Cabinet meeting last Friday (22nd), and the bill will be submitted to the National Diet session in January next year and will need to be passed by both houses. The planned implementation of the new changes is set to begin on April 1, 2024.

Prior to this, Japanese companies were required to report the amount of cryptocurrency holdings they acquired from third parties based on the difference between the market value and the book value, regardless of whether the company sold the cryptocurrency. However, now companies will only be taxed on the profits obtained from selling cryptocurrency, similar to the regulations that retail investors must comply with under Japanese tax law.