Japan’s National Tax Agency has published a guideline on the taxation of sales of non-fungible tokens (NFTs) and the profits earned by crypto and blockchain gamers.
Namely, the tax in question that is to be applied to NFT transactions is a consumption tax, which is Japan’s equivalent of VAT.
Japan's Tax Agency publishes guidelines for taxing NFT sales and crypto gaming profits
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Metaverse
Author: Kristina Dosen
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390
Content accuracy validation date:
24.01.2023
Content accuracy validation time:
08:55h
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According to the guideline, NFTs in Japan qualify as a form of intangible property, and NFT transactions in blockchain-based games will be taxed based on the total amount of income at the end of the year. The guideline also provides that no tax will be applied if the asset is not exchanged outside the game or if the asset has been stolen due to unauthorized wallet access. Lastly, creators of NFTs will also be taxed whenever they sell the NFTs to Japanese consumers and gain profits.
These guidelines are not yet implemented into the Japanese tax code or any other relevant laws. However, they are intended for use by local or central tax authorities and NTA officers until parliament amends the relevant legislation.
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