Japanese Finance Minister Taro Aso has hinted that he might not be willing to lower the tax bracket for cryptocurrencies from up to 55% and bringing it to a flat rate of 20%, similar to that of stocks.

Any form of crypto transactions or trading in Japan falls under miscellaneous tax categories, which has a steep tax rate of up to 55%.

Aso claimed that a majority of crypto investors in the country are not institutional investors, but rather small retail investors, and lowering the tax is not possible at present as it would make it more difficult for the common households to invest in digital currencies.

Japan is considered at the frontier in terms of implementing crypto regulations and many G-20 nations even asked for the country’s help to resolve digital asset regulations in their respective countries. However, for a country that was among the first to legalize crypto trading, a majority of its population have hoarded cash. Aso explained:

“Out of 1900 trillion yen [17.6 billion USD] financial assets held by households in Japan, around 900 trillion yen [8.4 billion USD] is now being held as cash deposits and that is abnormal,”

Japan may be one of the top tech-centered nations known for its inventions and progressive society, but the business owners in the country are still following traditional ways and believe in keeping their savings in cash.

Aso claimed that a majority of businesses in Japan are cash oriented and it would be quite difficult for the government to convince these business owners to put their cash in crypto.

Japan also modified its existing cryptocurrency legislation called the Payment Services Act (PSA) recently. The modification would now deem any form of virtual currency as a crypto asset.

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