Japan cuts crypto capital‑gains tax to 20% and expands regulation under new FIEA amendment

On 15 July the Japanese Diet’s upper house approved an amendment to the Financial Instruments and Exchange Act that moves cryptocurrency activities from the Payment Services Act into the securities‑law framework. The change introduces a flat 20 % separation tax on gains from crypto assets traded through domestically registered exchanges, replacing the previous maximum rate of up to 55 % and allowing a three‑year loss‑carryforward. The law also designates 105 major tokens, including Bitcoin and Ethereum, for full disclosure obligations similar to those for traditional securities, requiring exchanges to publish asset type, risk profile and technical details. Unregistered operators will continue to be taxed under ordinary income rules, while domestic exchanges gain stronger consumer‑protection duties and new enforcement tools. The amendment is set to take effect in 2027, with the tax regime applying from fiscal year 2028. The reforms aim to align Japan’s crypto market with global standards, encourage institutional participation, and clarify the regulatory split between protected domestic trading and unregulated overseas‑DEX activity.