Japan To Implement Stimulus Package With Tax Reforms

According to Cointelegraph, Japan is set to proceed with a proposed economic stimulus package following Prime Minister Shigeru Ishiba's commitment to engage in bipartisan discussions for comprehensive tax reform. The package is anticipated to be approved by the end of 2024 and includes significant changes to income tax, corporate taxes, and cryptocurrency taxes. This marks a shift from the governing party's previous stance, which favored higher taxes. The current situation has been described as challenging, with Japan's cryptocurrency tax policy relying on a complex "miscellaneous tax" that can impose up to a 55% levy on transactions. The opposition party advocates for a 20% flat tax rate on digital assets, along with various other tax reductions. Proposed tax cuts under discussion include raising the tax-free income threshold from $6,650 to $11,345, reducing fuel taxes, and lowering sales taxes until the employment market improves by at least 2%. Japan's digital assets market is showing signs of growth and maturity as the country aims to strengthen its economy ahead of 2025. Prior to Ishiba's election as prime minister in September, Yuichiro Tamaki, leader of the Democratic Party for the People and a former front-runner, had pledged digital asset reform to position Japan as a leader in Web3. Although Tamaki was defeated, the closely contested election highlighted a shift in national politics. The ruling Liberal Democratic Party retained power but lost 68 seats in the House of Representatives, likely prompting the renewed focus on bipartisan tax reform.