[NEWS] Financial Services Agency positions crypto assets as a key item in 2025 tax reform

On the 27th, the Financial Services Agency announced the main items related to the agency in response to the 2025 Tax Reform Outline. Among them, it clearly stated that tax reform for crypto assets (virtual currencies) "must be considered from the perspective of whether they should be treated as financial assets that should be the subject of investment for the public."

This was stated in the "Current Situation and Issues" section of the "Integration of Financial Income Taxation" section.

The 2025 Tax Reform Outline, which was recently revealed, explains that with regard to taxation of crypto assets, certain crypto assets will be positioned in the business law as financial products that contribute to the asset formation of the public, and necessary legal measures will be put in place, such as accountability obligations and suitability regulations for investor protection equivalent to other financial products, and that a review will be considered on the premise of establishing an obligation for trading companies to report the contents of transactions to tax authorities.

With the FSA positioning crypto assets as a major item of tax reform as part of the integration of financial income taxation, there is a possibility that discussion will become more active in the future. In addition, if discussions proceed along these key points, the possibility has emerged that legal reforms may be made to treat crypto assets as financial products.

The "Urgent Proposal for Making Crypto Assets an Asset that Contributes to the National Economy," approved by the LDP Policy Research Council this month, also states that "while paying attention to protecting users, it is possible to legally position some crypto assets as financial products and make them subject to regulation under the Financial Instruments and Exchange Act." This suggests that the FSA will consider regulating crypto assets as subject to the Financial Instruments and Exchange Act, rather than regulating them under the current framework of the Payment Services Act.

Bloomberg reported in September this year, citing sources, that the FSA may consider including crypto assets as subject to the Financial Instruments and Exchange Act. Sources also mentioned at the time that crypto asset ETFs would also be discussed, so including crypto assets as subject to the Financial Instruments and Exchange Act is likely to make this more feasible.

Reference: FSA
Image: Shutterstock

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