Japan’s National Tax Agency (NTA) has unveiled plans to change the way cryptocurrency investors pay tax on their earnings – and claims “simplification” is the guiding principle behind its reforms.
The changes had been mooted for some time, and the country’s finance minister Taro Aso hinted at the possibility of tax reform in a speech made last month. Cryptocurrency-related earnings will continue to be classified as “miscellaneous income,” however, despite speculation that the NTA would change the way crypto investors were required to file their earnings.
Per media outlet Sankei Biz, the NTA consulted with the regulatory Financial Services Agency, the Japan Blockchain Association and Japanese cryptocurrency-related businesses on its new system, which makes use of software that automatically calculates earnings and losses.
The NTA says its new system not only helps calculate payable tax, but also provides a quicker and easier way for investors to file taxes, doing away with confusing paperwork. The NTA says its solution will be of particular benefit to tech companies operating in the cryptocurrency sphere.
The announcement also contained good news for small-scale investors. The agency confirmed that only those with cryptocurrency-related earnings exceeding 200,000 yen (around USD 1,780) in the January 2018-December 2018 period will be required to pay and file tax returns.
The agency says that its changes were made with the objective of “easing the burden” on the country’s cryptocurrency investors and fintech enterprises.