Japanese Prime Minister Shigeru Ishiba has announced the inclusion of opposition tax cut proposals in an upcoming economic stimulus package, which involves benefits for gasoline and crypto assets.
Reforms and Agreements
According to a Bloomberg report on November 20, Ishiba secured approval for the stimulus package after agreeing to include reforms proposed by the Democratic Party for the People (DPP). Both major parties have also agreed to increase the budget for the package, expected to be finalized by the end of December and released later this week.
DPP's Policy
Makoto Hamaguchi, a senior DPP official, stated that the party’s proposals for the next fiscal year include raising the tax-free income threshold from 1.03 million yen ($6,650) to 1.78 million yen ($11,435) and implementing various tax cuts. Among these are temporary sales tax reductions to 5% until wages rise by 2%, incentives for companies raising salaries, and tax breaks for investments in industries like semiconductors, AI, and crypto assets. "We got confirmation that the ceiling, which didn’t move for 30 years, will move," Hamaguchi said.
Significance for the Crypto Industry
The DPP’s policy also includes taxing crypto gains at a flat 20%, aligning them with stock market profits. Currently, crypto falls under “miscellaneous income,” which can see tax rates as high as 55%, depending on individual earnings. A minor opposition party, the DPP gained significant influence in the October elections and now plays a critical role in balancing power with the ruling Liberal Democratic Party (LDP).
Support for crypto assets is strong across political lines. Prime Minister Ishiba’s policy focuses on using blockchain technologies and NFTs for Japan’s economic growth.
