A committee in Japan is looking up to simplify the tax process for cryptocurrencies to ensure that people who are investing, report their profit accurately.
As per the officials, currently, the procedure is bit complicated and to enhance accuracy, there’s a need to change. According to Sankei, a Japanese news publication, the committee, earlier this week, held a meeting where there was a discussion to change the present cryptocurrency tax system.
The problem lies in the fact that while evaluating the gains in cryptocurrency for taxation motive, some owners resist declaring their holdings in cryptocurrency during the tax return process.
The commission, in order to discuss the improvement needed to the process, held an assembly meeting on October 17. There’s plan to make a system that will help in standardizing tax filing process and also to make taxpayers easy to evaluate the profits on the digital assets sales.
As of now, calculating the profits in cryptocurrency is non-profitable. The price for crypto on multiple distinct exchanges can be different, apart from this, the way different platforms store the data is also not standardized. Therefore, taxpayers find it complicated to submit adequate tax filing.
The President of the Tax Committee, Minoru Nakazato, said that apart from taxation and business practices, it is important to consider frameworks too. A meeting of experts is to be held in order to hear opinions and to deepen the discussion simultaneously.
In Japan, the gains from sales of crypto fall under miscellaneous income. Japan face crypto tax rates ranging from 15% and 55%, depending upon the amount of profit above a threshold of $1800 USD. The tax paid depends upon the earning i.e. higher rate will be imposed on the person earning high. For example, an investor has to pay a 55% rate if he is earning more than 40 million yen, which is approximately 365,000 USD.