In 2016 in Japan, a law was passed that regulated the activities of stock exchanges are now subject to registration with the financial services Agency, which can check such businesses and to apply administrative measures against him. In accordance with this law, the cryptocurrency is the value of such assets (asset-like values). Transactions with the digital currency are not prohibited under Japanese law.
the Digital money and transactions with them are subject to taxation in accordance with the standard rules: income received by an individual as a cryptocurrency, is subject to income tax (Income Tax); profit legal entity in the digital currency is taxable profit (Corporate Tax); the sale of the cryptocurrency is subject to the Japanese equivalent of value added tax (Consumption Tax). From the payment of the last buyers of the digital currency can be released in the future.
the Starting point in the regulation of the cryptocurrency in Japan can be considered the collapse of a major exchange, MtGox, in February 2014.207 in Less than two weeks after that ruling liberal democratic party of Japan issued a statement regarding the legal status of Bitcoin and taxation of transactions with him.
In may 2014 appeared information that the government is going to control illicit transactions with Bitcoin, but while postponing plans to regulate the digital currency.
in the Summer of that year established a Commission on digital assets Japan (eJapan Authority of Digital Asset), which seeks to protect the interests of cryptocurrency businesses. The Commission has support from the government, but is a non-governmental organization. In fact, the Commission — self regulatory body (self-regulatory authority), established by the representatives of the cryptocurrency industry.
In June 2015, the government has begun to consider adopting new rules to counter the legalization (laundering) of incomes obtained in a criminal way and financing of terrorism as well as against other unlawful activity. In November, the financial services Agency decided that Japan should improve the mechanism of control over cryptocurrency.
At the end of 2015 appeared information that the Council working group on the financial system (Financial System Council) has compiled a draft proposal for regulating digital currency. It was reported that in accordance with the proposals of the exchanges which provide the opportunity for cryptocurrency exchange, must be registered with the financial services Agency (Financial Services Agency).
In February of 2016, it became known that the liberal democratic party of Japan is planning to propose changes to legislation that would define digital money currency. As reported, the changes will allow financial institutions (e.g. banks) to invest in the cryptocurrency, and will change the rules of the functioning of an exchange.
Immediately after this major Japanese newspaper Nikkei reported that the government has approved a bill that defines Bitcoin as a legitimate payment form, performing the functions of currency. In may the Japanese Parliament enacted a bill, which, according to another Japanese newspaper, the cryptocurrency was defined as the value of such assets (asset-like values), and a legitimate means of exchange, not a payment.
in addition, at the beginning of February 2016, Japanese newspaper Asashi said that a major Japanese Bank is developing its own cryptocurrency. In June 2016, the Bank confirmed the realization of such an experiment.
In accordance with the published liberal democratic party statement, bitcoin is not a currency or a bond (bond), and Japanese banks may not open Deposit accounts in Bitcoin, and to act as intermediaries in the purchase or sale of digital currency or its exchange for Fiat money. In his statement, the liberal democratic party referred to the 11 existing legal acts.
In his first leadership Commission on digital assets recommended in the opening exchanges and trading platforms to submit a special application to the Commission and to take appropriate measures to counter the legalization (laundering) of income obtained by criminal means and measures to ensure safety. Advised the Commission and to comply with the policy "Know your customer" (Know Your Customer).
In may 2016, the Japanese Parliament passed a law according to which:
- Operators of cryptocurrency exchanges must be registered with the financial services Agency (Financial Services Agency);
- the regulator has the authority to implement inspections of the exchanges and, if necessary, can be applied administrative measures.
- Cryptocurrency recognizes the value of such assets (asset-like values). However, digital currency is not considered legal tender and is regarded as a medium of exchange, which you can use to purchase goods, services, or a legitimate means of payment.
In accordance with the already mentioned statement of the liberal democratic party taxation of cryptocurrency and transactions in Japan is carried out by the standard rules enshrined in the tax laws. Thus, the income received by an individual as a cryptocurrency, is subject to income tax (Income Tax) and the profit of the legal entity in the digital currency — the profit tax (Corporate Tax).
moreover, the sale of crypto-currencies is subject to the Japanese equivalent of value added tax (Consumption Tax). But in July of 2017, buyers of digital money can be exempted from paying it.