JAPAN. The Japanese government has proposed changes to its tax-free policies for purchases made by foreign tourists, according to well-sourced media reports in the country.
Foreign visitors are exempt from paying Japan’s 10% consumption tax on purchases exceeding JPY5,000 (US$33) if the goods are for use outside the country.
In a potentially key move, consumption tax exemptions usually available at the point of sale would be reimbursed after tourists return to their home countries. This follows reports about abuses of the system identified by Prime Minister Shigeru Ishiba’s government, including the illicit resale of duty-free items by tourists before returning home.
Kyodo News said the government is set to incorporate the revisions into its upcoming tax reform proposals, due for completion in December.
According to the reports (which also featured in Japan Today and other media), the government plans to deploy verification devices at airports and ports with international departures to track the history of goods purchased under the tax-free regime.
In addition, the updated regulations will exclude foreign tourists from consumption tax exemptions if they send goods via Japanese post offices.
The consumption tax exemption is available at authorised locations such as airport duty-free shops, department stores, electronics stores and other tax office-approved outlets that sell goods for export. ✈
