The Financial Services Agency said it aims to lower the capital gains tax and allow tax exemptions on small capital gains.
The FSA plans to prepare legislation regarding these reforms -- a bid to revitalize the flagging stock market -- and will submit it to the Diet in September. By this time, the agency will have consulted the Finance Ministry and the ruling parties, an agency official said Wednesday.
Reform of the stock market is one of the main pillars of a blueprint for structural reform advocated by Prime Minister Junichiro Koizumi.