The Japanese financial newspaper Nikkei reported in early March that the country’s parliament, the Diet, will soon vote on a set of Bitcoin regulations to be put forward by the ruling cabinet.
The regulations proposed by Finance Minister Taro Aso of the ruling Liberal Democratic cabinet would classify Bitcoin as a currency, impose new requirements on Bitcoin exchanges and allow banks and securities firms to invest and trade in the virtual currency.
Following the collapse of Mt. Gox in early 2014, then the largest Bitcoin exchange in the world, Japan built a firewall separating Bitcoin from the financial sector. Banks were barred from buying and selling bitcoins, and securities firms were prevented from trading the virtual currency.
The proposed regulations would remove the firewall between Bitcoin and the financial sector, according to the Nikkei . Commercial banks would be allowed to provide Bitcoin to customers, and securities firms would be allowed to trade the virtual currency. The government hopes that removing the firewall will encourage the development of Japan’s emerging fintech industry.
The regulations, if passed by the Diet, would mark the first concrete step in a years-long debate about how to deal with Bitcoin. But not all Diet members are pleased with the proposal.
Tsukasa Akimoto, a member of the ruling Liberal Democratic party, asked Finance Minister Aso in a budget meeting in early February if maintaining the consumption tax on Bitcoin transactions would set Japan against the global trend . In response, Aso cited other countries such as Australia that also tax transactions using the virtual currency. As the proposal stands, Japan would continue to levy an 8 percent consumption tax on all purchases made with Bitcoin.
Continuing to tax Bitcoin will put Japan at a disadvantage and discourage its use by consumers, says Yuzo Kano, leader of the Japan Authority of Digital […]
