Japan’s Democratic Party for the People leader, Yuichiro Tamaki, pledges to reduce crypto tax to 20% along with other crypto-related policies if the party gains election victory.

Proposed Crypto Tax Reduction

In an X post on October 21, Japanese politician and Democratic Party for the People (DPP) leader, Yuichiro Tamaki, outlined his party’s proposed policies regarding cryptocurrency in Japan. Tamaki proposed lowering the tax on crypto gains to 20% if elected.

“If you believe crypto assets should be taxed separately at 20% instead of being treated as miscellaneous income, please vote for the Democratic Party for the People. There will be no tax when exchanging crypto assets with other crypto assets,” wrote Tamaki in a translated post.

Current Crypto Tax Regulations

Under Japan’s current regulations, crypto is classified under “miscellaneous income,” which means Japan’s crypto tax could reach up to 55%, depending on personal income. In contrast, profits earned from stock trading are subjected to a maximum tax rate of 20%.

DPP’s Policy Statement on Crypto

In the DPP’s policy statement, one of their key points includes “supporting the token economy using crypto assets.” The party aims to leverage non-fungible tokens (NFTs) and cryptocurrency to boost Japan’s economy.

“For now, we want to make Japan a strong nation in the web3 business,” said Tamaki in response to a user’s question on X.

The policy statement outlines a proposal to tax crypto gains at 20%, aligning digital assets with the tax rate on stock market profits. Under Tamaki’s plan, trading crypto assets would not trigger a tax event.

Additional DPP Crypto Initiatives

Apart from reducing the crypto tax, the DPP promises to increase the leverage multiplier from two-fold to ten-fold and introduce cryptocurrency exchange-traded funds (ETFs). They also plan to convert the yen into an electronic currency.

“Promote the issuance of ‘digital regional currencies’ (tentative name) by local governments as crypto assets that will help revitalize local economies,” stated the DPP.

Current Political Landscape

According to a recent survey by Japanese media, the DPP has limited chances of winning Japan’s election. The Liberal Democratic Party (LDP) and its coalition partner Komeito currently hold the majority of votes. However, the DPP may see its representation increase from seven to as many as 20 seats.

On October 1, Shigeru Ishiba, President of the LDP and Japan’s current Prime Minister, announced through a policy document that he intends to use blockchain technology and NFTs to boost Japan’s economy by revaluing local assets like food and tourism on a global scale.

Masaaki Taira, the current chief of LDP’s Web3 task force and Minister of Digital Affairs, proposed a plan to connect diverse experiences and apply Japanese intellectual property laws to NFTs. He also suggested measures to boost crypto startups by reforming Japan’s tax system.

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