CoinVoice has recently learned that the National Tax Agency of Japan announced today the results of the 2024 tax investigation showing that 613 on-site investigations were conducted against individuals trading cryptocurrencies, with a total tax amount of approximately 4.6 billion yen recovered, an increase of about 31.4% compared to the previous year's 3.5 billion yen. The number of investigations has also increased by about 14.6% year-on-year. The National Tax Agency pointed out that cases related to cryptocurrencies have significantly higher amounts of recovered taxes per case and reported unreported income compared to the overall average level of income tax on-site investigations. Current focuses of the tax investigation include the accuracy of profit and loss calculations, completeness of transaction records, and handling of declarations for special transactions such as DeFi, airdrops, mining, and staking; if multiple domestic and foreign exchanges are involved, all profits and losses must be consolidated for reporting, otherwise it may be deemed as omission in reporting. In addition, the National Tax Agency stated that it has continuously strengthened data collection and analysis of internet transactions and introduced AI technology to assist in selecting investigation targets. If omissions or non-reporting behaviors are identified, in addition to paying back taxes, there may also be additional late fees and surcharges, with non-reporting cases potentially incurring surcharges of up to 20%. If there is intentional concealment or fraud, the tax rate for heavy reassessment can reach up to 35% to 40%. At the tax system level, the Japanese government and the ruling party are discussing adjusting the taxation of cryptocurrency income from the current comprehensive taxation to a separate declaration tax similar to that of stocks, with a unified tax rate potentially set at 20%, and the introduction of mechanisms for offsetting gains and losses as well as loss carryforward. The direction of related reforms is expected to be further clarified in the year-end tax reform outline. [Original link]

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