In a united front, Japan's top crypto firms, including major exchanges, have vowed to continue pushing for tax reforms in the country. The Japan Blockchain Association (JBA), which comprises many of the nation's largest and most well-known crypto exchanges and blockchain-related firms, has set its sights on introducing new tax measures within the next 12 months.

The JBA's efforts aim to address the current tax laws, which require individual crypto traders to file their profits as "other income" on tax declarations. This can result in high-earning individuals facing a staggering 55% tax rate on their crypto earnings, significantly higher than the global average of around 20%.

A Call for Change

Yuzo Kano, CEO of bitFlyer Holdings and chair of the JBA, emphasized the need for change. He proposed that the JBA focus on introducing a new tax method for individual cryptocurrency transactions, which would involve separate self-reporting taxation and a flat 20% tax rate. Additionally, Kano wants to eliminate income tax on profits made from crypto-to-crypto trades, a move that aligns with tax laws in many other countries.

Key Demands

The JBA has outlined several key demands to the Japanese government:

1. Separate Self-Reporting Taxation: The JBA wants individual crypto traders to be able to report their transactions separately, rather than including them under "other income."

2. Flat 20% Tax Rate: The association is pushing for a flat 20% tax rate on crypto earnings, which is more in line with global standards.

3. Loss Carry-Forward: The JBA wants individual traders to be able to carry forward their losses on tax declarations, providing some relief for those who experience significant losses.

4. Reform of Leverage Ratios: The association is also calling for the government to reform its restrictive leverage ratios cap for crypto trading, which can limit trading activities.

A Decade of Progress

The JBA was established in 2014 and will celebrate its 10th anniversary in September this year. While the association has already achieved some success, such as the reform of crypto tax rules for corporations, it remains committed to pushing for further changes to benefit individual traders.

The united efforts of Japan's crypto firms demonstrate their dedication to creating a more favorable environment for the industry and its participants. As the JBA continues to advocate for tax reform, the future of crypto trading in Japan looks brighter than ever.