Survey: The complexity of the tax system is the main reason for Japanese investors selling off cryptocurrencies

According to BeInCrypto, a nationwide survey in Japan shows that among those who once held cryptocurrencies, 22.2% cited the complexity of the tax system as the main reason for their exit; 19.4% believed that price volatility was the primary reason. Currently, investors holding digital assets generally consider volatility (61.4%) and tax complexity (60%) as the two major challenges they face.

The report states that in Japan, cryptocurrency gains are classified as "miscellaneous income," with tax rates reaching up to 55% after local taxes are paid. Investors must track every transaction, calculate gains and losses in yen, and report annually. For many, this cumbersome administrative work outweighs investment returns—despite 62.7% of investors stating that long-term wealth accumulation is their main reason for investing, while only 15.1% prioritize short-term speculation.

Additionally, reports indicate that the Financial Services Agency of Japan plans to reclassify 105 types of cryptocurrencies as financial products and reduce the maximum tax rate on cryptocurrency gains from as high as 55% to 20%, aligning it with stock market tax policies. This reform proposal is expected to be submitted to the Diet for legislative review in 2026.