Japan’s tax reform bill which officially eliminated consumption tax on the sale of Bitcoin came into effect on July 1. Bitcoin trading activities are expected to rise in Japan following the activation of the bill.
In a report entitled “Japan: Inbound Tax Alert, 2017 Tax Reform Proposals,” Deloitte previously revealed that virtual currencies including Bitcoin were set to be exempt from the eight percent consumption tax in Japan.
Bitcoin price increases - a coincidence?
Although it could be completely coincidental- since the activation of the Japanese Bitcoin tax elimination bill on July 1, Bitcoin price increased from around $2,450 to $2,570. It is not a fair assessment to wholly attribute Bitcoin’s upward momentum to the Japanese market as it only accounts for 16.2 percent of the global Bitcoin exchange market.
However, positive signs for Bitcoin trading in Japan could have established a positive precedent across Asia, which controls more than 65 percent of the global Bitcoin exchange market share and affected bitcoin price.
Bitcoin’s tax elimination bill is also important for the ecosystem of Japanese Bitcoin merchants. Recently, some of Japan’s most influential companies including its largest electronics retailer Bic Camera started to accept Bitcoin as a digital currency and a payment method.
Soon, hundreds of thousands of restaurants, cafes and stores could begin accepting Bitcoin as AirRegi, Japan’s largest point of sale machine operator, is looking to integrate Bitcoin by the fall of 2017.
