On October 3rd, Prime Minister of Japan Fumio Kishida addressed Japan’s National Diet. In the speech, Prime Minister Kishida stated that the country’s plan for digital solutions already includes non-fungible tokens (NFTs) and the metaverse.
Japanese Government to Utilize Web 3.0 Services
According to Kishida, the government is working to promote Web 3.0 services, including those concerned with NFTs and the metaverse.
According to the Prime Minister, the Japanese government’s digital transformation plan for the country already includes provisions for giving NFTs to local authorities, who have been using digital technology to address the issues in their territories.
In a cooperative effort with the United States, Kishida stated that Japan would expand its technological investments to include the production of semiconductors and regulatory reform for the tech industry.
The Prime Minister also made reference to a project that will see national identification cards digitized. Kishida further asserted that the cabinet would support Web 3.0 initiatives to increase the usage of services in the sector—particularly those centered around the metaverse and NFTs.
The Prime Minister has previously stated that adopting new digital services, like the metaverse and NFTs, would help strengthen Japan’s economy. Kishida has held the office since 2021, succeeding former Prime Minister Yoshihide Suga.
A Pro-Crypto Government
Cryptocurrency users in Japan have witnessed several changes during Kishida’s term in power. Of particular note is the status of Japanese crypto exchange Mt. Gox, which will finally go ahead with reimbursement procedures after years of legal hurdles. Kishida has also overseen the reinstallation of cryptocurrency ATMs in the country.
A new policy for the advancement and expansion of Japan’s Web 3.0 landscape, including increasing the usage of cryptocurrencies, NFTs, and decentralized autonomous organizations (DAOs), received approval from the Japanese government in June of this year.
The measures represent part of the government’s ‘Basic Policy on Economic and Fiscal Management and Reform 2022′, and are intended to generate new value for the national economy through the promotion of blockchain technology and digital assets, as well as by enabling users to manage and utilize their own data through more decentralized and dependable digital platforms.
On the Flipside
- Currently, in Japan, crypto assets are subject to “Miscellaneous Income Tax” ranging from 5% to 45% on profits. A 10% Municipal tax is also added to this at all rates, ultimately leading to a maximum potential tax rate of 55%. Such hefty taxation policies can often slow down a country’s crypto adoption rate.
- In August, two of the nation’s top crypto advocacy groups, the Japan Crypto-Asset Business Association and the Japan Crypto-Asset Exchange Association, advocated for an independent 20% tax on cryptocurrency gains for private investors.
Why You Should Care
Japan’s economy ranks fourth in purchasing power parity, and third in nominal gross domestic output. The crypto industry is booming in Japan. Between January and November 2021, cryptocurrency exchange transactions in Japan increased by 51% to reach 103 trillion yen ($900 billion USD), putting the country on track to surpass $1 trillion USD for the entire year.