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The National Tax Agency of Japan has released guidelines for taxing transactions involving blockchain game tokens and NFTs, covering income tax, consumption tax, and other situations

ChainCatcher news, the National Tax Agency of Japan has released a general handling document regarding NFT taxation. The guidelines not only list cases of income tax levied on NFTs but also provide examples of cases involving consumption tax. Due to the frequent acquisition and use of in-game tokens, which are difficult to assess, a unified calculation will be conducted at the end of the year.The guidelines state that if an individual creates an NFT and sells it to a third party (first distribution), or if the purchaser of the NFT resells it to another person (second distribution), the profit is considered "income tax" and is subject to taxation. Additionally, when selling the purchased NFT to others as part of secondary circulation, if the sale is conducted through a Japanese operator, consumption tax will be levied on that operator.Rewards obtained through blockchain games are generally classified as "miscellaneous income," which is subject to income tax. However, in-game tokens received as rewards that can only be used within the game are not considered taxable income. Furthermore, the previously unclear situation of "NFTs being stolen or disappearing due to unauthorized access" has also been clarified in terms of tax law principles. However, the FAQ only provides general handling responses, and specific issues will be treated specifically, so it is necessary to confirm the detailed calculation methods for declarations with experts and the National Tax Agency. (source link)
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