Category Taxation in Japan

Japan Sets Out on Tax Reform

December 15, 2017 Taxation in Japan

Japanese taxTOKYO – Japan will hikes taxes for some, while pushing big businesses to boost wages.

The government of Japan has approved a sweeping set of tax reform measures aimed at boosting tax revenues, while also increasing inflation in the country.

Japan has faced deflation for a significant period of time, and, further, an ageing population means that the country is expecting to feel the economic cost of a rising welfare bill in the near future.

As a means countering the unwanted effects of deflation and welfare costs, the government hopes to encourage large businesses to increase wages, in turn boosting consumer spending.

Under the scope of the tax reform, the rate of corporate income tax in Japan would fall from 30 percent to 20 percent for businesses which stop hoarding cash in order to dra...

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Japan Eyes Tax Reward for Wage Hikes

December 4, 2017 Taxation in Japan

japanese-yen-notes-757cfTOKYO – Wage hikes and robots could soon help Japanese companies slash their tax obligations.

The government of Japan is evaluating potential new tax break which could see the business tax burden reduced by nearly a third.

Japan has spent the last several years taking steps to reduce the level of corporate income tax faced by businesses, which is expected to fall to as little as 29.74 percent in the business year starting April 2018.

However, the government is now looking at reducing the rate to as low as 20 percent.

The reduction will come in the form of deductions made available to businesses which actively invest in human resources, such as wage hikes and training programs.

Some deductions will also be available to businesses which invest in technologies to increase output and produ...

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Japan Exit Tax Will Pay for Safety System

November 21, 2017 Taxation in Japan

First Class Check-in Counter at NRT Narita Airport - Japan AirlinesTOKYO – Japan could soon have a system to keep tabs on all Japanese tourists around the world, paid for by all the international and local tourists leaving the country.

The Japan Tourism Agency is looking at using the revenues raised from a proposed exit tax to fund the development of a system to check on the safety of Japanese tourists travelling abroad.

Currently, the government of Japan is looking at implementing an exit tax of JPY 1 000 per person leaving eh country on a plane or ship, with the charge to be added to the fare paid for the travel.

The Agency hopes to use the funds to create a system which will centrally manage the records and information about Japanese travellers who are overseas.

The new system will allow the government to easily collect information on the status and...

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Offshore Retailers Face Tax in Japan

November 2, 2017 Taxation in Japan

Online tax in JapanTOKYO – Japan is cracking down on online retailers who skip taxes by not having an office in the country.

The government of Japan recently announced that it is looking to amend current legislation to update the definition of a permanent establishment of a business, in an effort to bring a number of online businesses into the country’s tax net.

Currently, Japan applies corporate income tax to businesses which have a permanent establishment in the country.

The current definition of permanent establishment primarily consists of offices, and misses warehouses and distributions centres.

The specifics of the tax mean that online retailers which do not have an office in the country, but have a distribution centre, can earn significant profits from Japanese customers, but not pay any tax on t...

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Japan’s Exit Tax Could Kill Jobs

November 1, 2017 Taxation in Japan

Japan Air TaxTOKYO – A new tax in Japan will lead to a boost in tax revenues or a drop in GDP and a sharp drop in aviation jobs.

Late last week the International Air Transport Association issued a warning that the proposed exit tax on flights from Japan could result in thousands of lost jobs and a significant reduction in the national GDP.

The current proposal for the tax is a charge of JPY 1 000 per person who leaves the country on an international flight.

Currently, an approximate 24 million tourists and a further 17 million nationals per year fly out of Japan.

If the tax does not reduce the number of flights, then the measure could bring in as much as JPY 41 billion.

However, the International Air Transport Association believes that the tax could reduce the number of flights by 7 million passengers...

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