Japanese Eco Taxes Poised For 2011 Introduction

by Mary Swire, Tax-News.com, Hong Kong

10 December 2010

Japan’s tax commission looks set to propose an environmental tax for introduction from October 2011, to be imposed on petroleum, natural gas, and coal, as part of government efforts to curb the use of polluting fossil fuels. The proposal is expected to feature in the government’s fiscal plan to be presented on December 13.

The proceeds of the tax - estimated to be JPY260bn (USD2.86bn) over the next four years - are to be channelled into environmental initiatives, the Nikkei business daily said, noting that the levy would equate to a tax increase of JPY1,200 on the average household.

According to the paper, taxes on crude oil and petroleum products will be progressively increased until they are around JPY790 per kilolitre; JPY810 per tonne of liquefied natural gas; and JPY700 per tonne of coal.

The introduction of the tax would be consistent with the government’s stated commitment to reducing the country's greenhouse gas emissions to a quarter of that emitted in 1990 by 2020.

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