Japan Passes Bill to Tax Crypto at 20% and Treat It Like Stocks
— By Tony Rabbit in Regulation
Japan's lower house passed a bill reclassifying crypto as financial instruments, cutting taxes to 20% and opening doors for ETFs.
Japan's lower house of parliament has passed a significant bill that reclassifies crypto assets as financial instruments, aligning them with securities under the Financial Instruments and Exchange Act (FIEA).
Key Legislative Changes
The bill, passed on June 11, 2026, marks a pivotal moment for crypto regulation in Japan. By reclassifying crypto assets under FIEA, they will now be treated similarly to traditional securities.
This reclassification introduces mandatory disclosure rules, provisions against insider trading, and stricter supervision for both crypto issuers and exchanges operating within Japan.
Tax Reform Details
Under the government's 2026 tax reform plan, profits from a selection of approximately 105 approved cryptocurrencies will be subject to a flat 20 percent tax rate. This represents a significant reduction from current rates, which can reach as high as 55 percent, and matches the tax rate applied to stock trading.
Additionally, a three-year loss carryforward system, previously available for equities, will now be extended to these approved cryptocurrencies, offering more flexibility for investors.
Implications for the Crypto Market
The move is widely interpreted as a foundational step toward the introduction of Japanese crypto ETFs. The enhanced regulatory framework and reduced tax burden could attract more institutional and retail investors to the crypto space.
Market participants will be closely monitoring the performance of affected tokens on platforms like DEXTools as these changes take effect.
What's Next
The bill still requires approval from the upper house of parliament. If passed, it is anticipated to take effect next year, further solidifying Japan's progressive stance on crypto regulation.
Reporting on these developments was provided by Bloomberg and CoinDesk.
Frequently Asked Questions
What is the new tax rate for crypto profits in Japan?
Profits on a selection of about 105 approved cryptocurrencies will be taxed at a flat 20 percent, down from rates as high as 55 percent.
When was the bill passed by Japan's lower house?
The bill was passed by Japan's lower house of parliament on June 11, 2026.
What does reclassifying crypto as financial instruments mean?
It means crypto assets will be treated under the same framework as securities, bringing mandatory disclosure rules, insider-trading provisions, and stricter supervision of issuers and exchanges.
Does the bill still need further approval?
Yes, the bill still needs upper house approval and is expected to take effect next year.