Consumption taxes

Nature of the tax

Japanese Consumption Tax (JCT).

Tax rate

National consumption tax :4%
Calculated on the total amount of sales (excluding sales not subject to tax) and once the total amount of purchases subject to tax has been deducted.

Local consumption tax : 1%
Calculated on the total amount of consumption tax due.

Reduced tax rate

None

Other consumption taxes

Other consumption taxes are levied at the national level and the local level: liquor tax, tobacco tax, gasoline tax, aviation fuel tax, liquefied petroleum gas tax, petroleum tax, motor vehicle tax, etc.

Corporate taxes

Tax rate

Tax rate for foreign companies

Resident companies are taxed on their worldwide income; non-resident companies are taxed only on Japanese-source income. A company that has its principal or main office in Japan is considered to be resident. For additional information.

Capital gains taxation

Taxed at the corporate tax rate.
Capital gains tax on land transfers is subject to a specific method of calculation.

Main allowable deductions and tax credit

Bad debt, repairs, natural disasters, charitable donation, R&D expenses, etc.

Other corporate taxes

Stamp tax, registration and license tax.

Individual taxes

Tax rate

Allowable deductions and tax credit

Dependent spouse, young children, disabled and elderly dependents, social insurance, etc.

Special expatriate tax regime

No special expatriate tax regime in Japan.

Double taxation treaties

Countries with whom a double taxation treaty have been signed

See the list of double Taxation Agreements

See the list of Japanese Tax Treaties.

Withholding taxes

Dividends: 20%, Interest: 20%, Royalties: 20%

Bilateral agreement

Sources of fiscal information

Tax Authorities

National Tax Agency Japan

Other domestic resources

Information on the Japanese tax system
Income tax guide for foreigners