Japan is reportedly planning to exempt bitcoin and other virtual currencies from a national sales tax.
The country’s Financial Services Agency – its top finance regulator – along with the Ministry of Finance are deliberating on a possible exemption, according to regional news service Nikkei. Bitcoin purchases in Japan are currently subject to an 8% sales tax.
“Discussions between the Finance Ministry and Financial Services Agency are expected to lead to a formal decision after talks by a ruling-coalition tax panel at the end of the year,” the agency reported.
According to the report, the government is planning to use legislation passed in May that classified bitcoin as a kind of prepaid payment instrument.
The service further quoted an unnamed representative from a Japanese bitcoin exchange, who indicated that the move would significantly cut administrative costs.
News that the government might be pulling back the sales tax comes months after a lawmaker from Japan’s ruling political party, the Liberal Democratic Party, pushed for such an exemption. In March, Diet member Tsukasa Akimoto pushed Finance Minister Tarō Asō to rescind the tax – a call that Asō reportedly pushed back on at the time.
The FSA and the Japanese Finance Ministry did not immediately respond to requests for comment.
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