Bitcoin has been deemed not a currency, but a commodity like gold or silver, in Japan. The government is poised to lay out regulation and tax bitcoin trades, according to Nikkei.
Not surprisingly, traders who accumulate gains from their bitcoin trading activities will be subject to tax. In addition, purchases made with the digital currency will be subject to Japan’s consumption tax — slated to rise to 8 percent come April 1st. As a side note, all purchases made in the Japanese Yen are subject to this consumption tax, so it is not exclusive to bitcoin use.
The Japanese government will reportedly be prohibiting banks from dealing with bitcoins, as well, according to the Nikkei report. Securities brokers are also not allowed to facilitate bitcoin trades.
These set of rules will make Japan one of the world’s first large-scale economies to impose regulation on the digital currency, and it could very well set a precedent for other governments around the world.
The news comes in the wake of a convoluted series of events surrounding disgraced bitcoin exchange Mt. Gox, which was based in Tokyo.
It is not clear, at this point, just when proper guidance will be released by the government.