Including Tax Relief in the Stimulus Plan Japanese Prime Minister Shigeru Ishiba has announced that his upcoming economic stimulus package will include proposals for tax cuts, including measures aimed at cryptocurrencies. These steps are based on suggestions from the opposition Democratic Party for the People (DPP). According to a report published on November 20, the Prime Minister secured support for his plan after promising to incorporate the DPP's annual tax reform proposals. The stimulus package is set to be unveiled this week, with its budget to be increased by the end of December. Key Proposed Tax Reforms The DPP's proposed changes include: Raising the untaxed income limit from 1.03 million yen to 1.78 million yen.Temporarily reducing the turnover tax to 5% until wages rise by 2%.Tax incentives for companies increasing salaries or investing in semiconductors, artificial intelligence, and cryptocurrencies.Cutting cryptocurrency profit taxes to 20%, aligning them with stock market gains. A New Direction for Crypto Taxation Current Japanese laws classify cryptocurrency profits as "miscellaneous income," which can result in tax rates as high as 55%, depending on income levels. In contrast, stock market gains are taxed at a maximum rate of 20%. The DPP advocates for virtual assets to be taxed at the same level as stocks. Support for Cryptocurrencies on Both Sides The DPP has long supported the development of cryptocurrencies and blockchain as tools to revitalize the economy. As part of its agenda, the party pledged to advance the token economy and expand the use of NFTs. Similar interest can be observed among members of the ruling Liberal Democratic Party (LDP). In his policy document, Shigeru Ishiba stated that blockchain and NFT technologies could be key to strengthening the economy. Additionally, Digital Affairs Minister Masaaki Taira supports reforms to facilitate the operations of crypto startups and apply intellectual property laws to NFTs. Balancing Power Between Government and Opposition The DPP, which retained its influence in parliament after the October elections, acts as a counterbalance to the ruling LDP. Thanks to this influence, it has managed to push forward significant changes, such as the proposed tax reforms. The stimulus package incorporating the DPP's proposals could be a pivotal step in developing Japan's crypto eco, with tax cuts potentially attracting more investors and innovations to the sector.

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