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Japan's Cabinet Endorses Tax Reform Plans

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

05 February 2018


Japan's Cabinet recently approved tax reform bills, which have now been introduced into the country's parliament for debate.

The bills propose to cut the corporate tax rate to 25 percent for companies who increase employee wages by three percent. A further reduction to 20 percent will be possible for companies investing in improving their productivity or engaging in digitalization. The tax relief starts in the next fiscal year, beginning in April, and will last for three years only.

Other measures contained in the bills will see duties on tobacco products rise from October 2018, and a new departure tax of JPY1,000 (USD9.90) per person from January 2019.

Proposed personal tax changes, taking effect from January 2020, include tax rises for workers earning more than JPY8.5m (USD77,394) per year, and reduced tax deductions for company employees.

The changes contained in the bills were first announced in a tax reform package approved by the ruling Liberal Democratic Party on December 14, 2017.

TAGS: tax | economics | air passenger duty (APD) | fiscal policy | employees | budget | corporation tax | tax reform | individual income tax | Japan | Other

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