Japan’s plan to drop an 8% sales tax on bitcoin purchases could take effect as early as July 2017, according to documents obtained by CoinDesk.
Though subject to final approval by senior Japanese government officials, an annual tax document prepared by the ruling Liberal Democratic Party and the Komeito party and published today offers new details on a proposal floated in October by the Ministry of Finance and the Financial Services Agency.
The tax remains in place today. Yet if approved by the Cabinet, the plan would institute a grace period in June of next year, with the tax exemption becoming official the following month. The document release is the culmination of discussions between government stakeholders first reported by regional news service Nikkei.
Bitcoin startups in Japan have responded positively to the move.
Mike Kayamori, CEO of exchange service Quoine, said that the plan to drop the sales tax was expected but represents a “good message to the crypto-currency community”.
He told CoinDesk:
“It’s a huge relief for us. Customers don’t have to pay tax for each transaction. Hope this becomes standard practice.”
The move caps a busy year in Japan on the exchange front, as the government moved to mandate registration requirements on companies handling bitcoin sales in the country.
Discussions around exchange regulation began in late 2015 between government ministers, who mulled ways to gather information from exchange services. a The deliberations took place within the context of the collapse of Mt Gox, the now-defunct bitcoin exchange that imploded in early 2014, resulting in hundreds of millions of dollars in lost customer funds.
The Japanese-language tax document can be found below:
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