Japan's Financial Services Agency plans to reform cryptocurrency taxation, proposing a flat 20% tax rate

PANews reported on August 23rd that BeInCrypto, citing local Japanese news media Nikkei, reported that Japan's Financial Services Agency (FSA) plans to include cryptocurrency tax reform in its 2026 tax revision plan. The plan is expected to combine tax changes with stricter regulations and may introduce ETFs linked to cryptocurrencies.

The reform package contains two key components. First, it includes a revision of the tax code to move cryptocurrencies from comprehensive taxation to the same category as stocks. Second, it includes a legal amendment to reclassify cryptocurrencies as financial products, enabling the FSA to apply insider trading rules, disclosure standards, and investor protections under the Financial Instruments and Exchange Act. Currently, Japan taxes cryptocurrency gains as "miscellaneous income" at a progressive rate that can exceed 50% once local taxes are factored in. Stocks and bonds, on the other hand, are subject to a flat 20% tax.