Japan Exempts Tax Filing for Trust-Based Stablecoins in Major Regulatory Shift

The Financial Services Agency (FSA) of Japan has asked the government to exempt trust-based stablecoins from tax filing requirements each time a beneficiary changes during circulation. This move follows the regulator's lifting of the 1 million yen limit on stablecoin transactions.

Under the current tax law, trustees must file beneficiary statements whenever trust beneficiaries change. However, stablecoins circulate continuously as payment instruments, making it difficult for trustees to track changes in holders. The FSA has requested an exemption from this requirement as part of its 2027 tax reform proposal.

The proposal aims to ease tax reporting burdens tied to trust-based stablecoin. This is a significant step for Japan's stablecoin market and digital asset adoption, which has been gaining momentum with the country's reformed crypto laws classifying digital assets as financial products and reducing the maximum tax rate to 20%.

SBI's JPYSC and Ripple's RLUSD are expected to benefit from this tax reform. Notably, the FSA also asked for similar tax treatment for foreign-issued trust-based stablecoins that already qualify as electronic payment instruments.