A request for tax reform to impose a 20% separate taxation on cryptoassets, including Wallets and DEX ─ JVCEA and JCBA | CoinDesk JAPAN

The Japan Virtual Currency Exchange Association (JVCEA) and the Japan Crypto Asset Business Association (JCBA) jointly submitted a "Request for Tax Reform for FY2026" to the Financial Services Agency on July 30 and held an online briefing.

The main requests include the introduction of a separate taxation of about 20% on profits from the sale of cryptoassets, clarification of tax-exempt measures related to donations of cryptoassets, and a review of the taxation system upon inheritance.

On July 18, the Japan Blockchain Association (JBA) also submitted a request for tax reform to the Financial Services Agency with a similar purpose. The content is generally consistent, but differences can be seen regarding the scope of separate taxation related to Wallets.

How to Handle Exchanges Other Than Registered Exchanges

JBA seeks to apply separate taxation only to sales at domestic registered exchanges for transactions made with wallets held by individuals. It is desirable to consider sales at unregistered exchanges and DEX as "not subject to separate taxation."

Related article: 55% tax on cryptoassets is "too heavy" - JBA requests five items including separate taxation, concerns about tax system "twists".

On the other hand, in the request submitted by JVCEA and JCBA this time, they are calling for the introduction of uniform separate taxation that includes transactions in wallets and DEX, regardless of the transaction type or whether the business is registered.

〈説明資料から〉At this day's briefing, the chairman of JVCEA, Mr. Genki Oda (CEO of the cryptoassets exchange Bitpoint Japan), the chairman of JCBA, Mr. Noriyuki Hirose (CEO of the cryptoassets exchange Bitbank), and Mr. Gaku Saito, the chairman of the tax system study group of the association and CEO of Pafin, which provides automated cryptoassets profit and loss calculation services, were present. Mr. Saito explained the outline of the requests.

What differs significantly from the request made by JBA the other day in this request is the scope of application of the separate declaration taxation. This difference is also influenced by the nature of the industry organization and the differences among its member constituents.

Mr. Hirozo Kanou, the chairman of JBA, is the representative director and CEO of the major cryptoasset exchange bitFlyer. The dynamics within the industry are also visible, suggesting that ensuring the soundness of the industry and prioritizing the establishment of systems centered around registered businesses should be addressed.

On the other hand, particularly, the JCBA has a diverse range of members spanning the Web3 domain, including wallet operators and NFT-related businesses. It emphasizes the integrity and institutional design of the entire ecosystem, including services outside of exchanges.

"Side Effects" for Web3 Businesses

Mr. Saito pointed out that "the Web3 ecosystem includes not only exchanges but also many wallet and NFT-related businesses." Under the country's promotion of Web3 as a national strategy, many Web3-related startups have emerged domestically, creating investment and employment opportunities. He stated that a system that favors only registered exchanges could go against the national strategy of promoting Web3.

〈Chairman of JCBA Taxation Study Group, Mr. Takashi Saito〉In fact, among JCBA members, about 40% are involved in "on-chain related businesses," and there is currently an active entry of operators other than exchanges and trading venues.

Mr. Saito pointed out the reality of system design and the side effects on Web3-related businesses regarding the introduction of uniform separate taxation.

The phrase "excluding unregistered exchanges" may seem simple at first glance, but it has been pointed out that clearly defining and drawing a line between registered and unregistered entities within the system is extremely difficult. If a preferential tax system is introduced only for registered businesses, it will only lead to the "expansion of the exchange economy" and become an excessive constraint for players conducting regular transactions and non-exchange operators.

Furthermore, it should be a fundamental premise to prevent the outflow of funds to unregistered businesses, but it is argued that "this incentive structure should not be implemented through taxation." Measures against unregistered businesses should be carried out from the perspective of system development, and if taxation is given an excessive regulatory role, it will "have side effects on the entire Web3 business," raising alarms.

Taxation framework for unhosted transactions

In terms of taxation, one of the issues will be ensuring "supplementarity" so that tax authorities can grasp who has gained how much profit.

In this regard, Yoshida Yoshihiro, CEO of HashPort, who is involved in the development of unhosted Wallets and is a director of JCBA, argued that the introduction of separate taxation, including Wallet transactions, is possible from the perspective of the supplementary nature of the taxation system.

While the difficulty of tracking is pointed out as a means of exchanging cryptoassets without going through an exchange, according to Yoshida, multiple tax support services for users of unhosted wallets have already appeared domestically, and it is entirely possible to build a system that enhances traceability.

It was pointed out that "instead of excluding it because it is difficult to supplement, creating an environment where supplementation is possible will lead to healthy development in the industry."

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