Japan Consumption Tax update

Mon 16th Mar 2015

Following the delay of the second Japanese Consumption Tax rise due in 2016, new tax bills have been introduced confirming plans for continued reform. The main points of the new bill include:

Consumption Tax

  • Confirmation of the delay in the Consumption Tax rise from 8% to 10% in October 2016
  • A new scheduled date for the implementation of the tax rise for 1 April 2017
  • The inclusion in the Consumption Tax net of electronic services to Japanese consumers by foreign resident providers from 1 October 2015
  • The acceptance of non-resident registrations for B2C digital supplies from July 2015
  • The exclusion of non-resident B2B supplies to Japanese customers of digital services from Consumption Tax

Corporate Income Tax

  • Reduction in the main corporate income tax rate from 25.5% to 23.9%
  • Reduction of the effective corporation income tax rate from 34.62 to 32.11% (which includes federal and state rates)

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