Japan’s crypto policy overhaul moved a step forward on July 15 as new details emerged on the tax regime and regulatory scope tied to the country’s Financial Instruments and Exchange Act, or FIEA. According to NHK, crypto capital gains would be shifted from the current miscellaneous income framework, where the top rate can reach 55% including local taxes, to a flat 20% tax rate. The plan would also allow losses to be carried forward for three years.
The report also said 105 major cryptocurrencies, including BTC and ETH, would be formally brought under FIEA and made subject to full disclosure obligations. ABMedia described the update as a key milestone following Chain News’ April 10 report that Japan’s Cabinet had approved an amendment to the Financial Instruments and Exchange Act.
Crypto gains would be taxed at 20% instead of up to 55%
Japan’s current crypto tax structure has long faced criticism from the industry. At present, crypto capital gains are classified as miscellaneous income, with the top marginal rate reaching 55% when local taxes are included. There is also no loss carryforward mechanism, meaning losses from a previous year cannot be offset against gains in later years.
Under the new framework led by the Financial Services Agency, crypto assets would be handled in the same tax category as traditional financial products such as stocks, futures, and investment trusts once they are brought into the FIEA system. That means a separate flat 20% tax and a three-year loss carryforward.
ABMedia said the change could cut the effective tax burden on Japan-based crypto investors by more than half, while also opening a clearer route for institutional participation. The outlet said institutions had previously stayed away from crypto assets because of the complexity of the existing tax structure.
105 tokens would be covered, while others remain outside the framework
A second major detail in the NHK report is the scope of the rules. The FSA plans to designate 105 major cryptocurrencies for inclusion under FIEA. The list includes leading assets such as BTC and ETH.
Tokens outside the designated list would not be covered for now. In practice, that leaves long-tail altcoins outside the FIEA framework, with a different tax and regulatory standing from the assets that make the cut.
Exchanges would face disclosure rules comparable to traditional securities
For exchanges, FIEA would impose disclosure obligations on a level comparable to those applied to traditional securities. For each designated token, required disclosures would include the asset’s type and characteristics, its underlying technical architecture, its volatility and market risk profile, and any other material factor that could affect an investment decision.
ABMedia said this would amount to Japan’s most complete information disclosure framework for crypto assets to date. The outlet also said the intensity of the requirement is close to the disclosure standard the U.S. Securities and Exchange Commission applies to securities issuers.
Legislative process is moving in three stages, with full rollout expected in 2027
The legislative timeline is being advanced in phases. Japan’s Cabinet passed the amendment to the Financial Instruments and Exchange Act on April 10, 2026. The House of Representatives passed it around June 10 to 11. The House of Councillors is still reviewing the bill.
Full implementation is expected in 2027. At that point, the 20% tax rate, the three-year loss carryforward, the 105-token list, and the disclosure obligations are expected to take effect together.
Japan’s progress is being watched alongside South Korea’s policy moves
ABMedia also placed the development alongside policy activity in South Korea. On the same day, July 15, South Korea’s Ministry of Economy and Finance released its “2026 Second Half Strategy,” listing legal revisions for spot crypto ETFs as a key item. But South Korea’s Digital Asset Basic Act, or DABA, remains stuck on the issue of who should be allowed to issue stablecoins.
Against that backdrop, ABMedia said Japan’s path appears more mature, moving from Cabinet approval in April to passage in the House of Representatives in June, with full application expected in 2027. The outlet described Japan as one of the fastest-moving major East Asian economies in bringing crypto assets into a full financial-instrument regulatory framework.