Japan Tax Reform

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EY Japan Tax offers news alert and webcasts detailing all of the latest developments on tax reform in Japan.

2024 Japan tax reform

The 2024 Japan tax reform outline was released on 14 December 2023.

Related topics Tax

The team

Kazuhiro Ebina

Kazuhiro Ebina

EY Japan Managing Partner – Tax, Managing Partner, Ernst & Young Tax Co.

Koichi Sekiya

Koichi Sekiya

EY Japan Tax Policy and Controversy Leader

Toshikazu Shintani

Toshikazu Shintani

EY Japan Tax Global Compliance & Reporting Leader, Osaka Office Manager

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Overview of the major amendments and revisions 

Corporate taxation

  1.  Tax incentives encouraging wage increases
  2.  Creation of tax credit to promote domestic production in strategic industries
  3.  Creation of the “Innovation box” regime
  4.  Revision of R&D tax rules
  5.  Revision of size-based enterprise taxation
  6.  Other

International taxation

  1.  Revision of top-up tax assumed as corporate tax
  2.  Revision of qualified capital contributions in kind
  3.  Revision of Japanese Controlled Foreign Company (“J-CFC”) rules
  4.  Establishment of reporting system for the automatic exchange of information requests related to crypto asset transactions of non-residents
  5.  Other

Individual income taxation

  1.  One-time fixed amount reduction of income tax and inhabitant tax
  2.  Revision of dependent deduction (2025 tax reform)
  3.  Revision of housing-related tax credit for households with children
  4.  Revision of stock option rules
  5.  Expansion of angel investor tax rules

Consumption taxation

  1.  Introduction of platform taxation
  2.  Revision of tax-exempt enterprise system used by foreign businesses
  3.  Revision of simplified taxation rules
  4.  Revision of consumption tax exemption rules for foreign tourists (2025 tax reform)
  5.  Other

Asset taxation

  1.  Fixed asset tax
  2.  Business succession tax rules

Tax administration

  1.  Additions to heavy additional taxes
  2.  Secondary tax liability on representatives of companies committing fraud to avoid taxes
  3.  Other

*Please note that the contents of this newsletter may be partially revised, deleted or added to in response to future Diet deliberations on the reform bill.

Newsletters and alerts in English

Please refer to the link below for previous Japan Tax Reform.

  • 2023 Japan tax reform

    Overview of the major amendments and revisions 

    Corporate taxation

    1. Revision of R&D tax rules
    2. Revision of tax incentive to promote open innovation
    3. Revision of spin-off tax rules
    4. Revision of crypto asset mark-to-market valuation methodology
    5. Other

    International taxation

    1. Introduction of global minimum tax
    2. Revision of foreign subsidiary income inclusion tax rules (JCFC)
    3. Other

    Individual income taxation, asset taxation and consumption taxation

    1. Expansion of NISA scope and duration
    2. Revision of inheritance tax and gift tax
    3. Revision of qualified invoice system
    4. Creation of tax incentive to spur re-investment in startups
    5. Extension of exercise period within stock option rules
    6. Strengthened taxation on the income of high-net-worth individuals
    7. Other

    Tax administration and other items 

    1. Revision of the electronic book preservation act (e-retention) rules
    2. Revision of penalties
    3. Tax rules and measures to secure funds for national defense build-up
    4. Eco-car tax incentives
    5. Other topics

    *Please note that the contents of this newsletter may be partially revised, deleted or added to in response to future Diet deliberations on the reform bill.

    Newsletters and alerts in English

    Webcast

  • 2022 Japan tax reform

    Overview of the major amendments and revisions  

    Corporate taxation

    1. Enhancement of the tax incentives to encourage wage increases
    2. Extension and enhancement of the tax incentive to promote open innovation
    3. Other revisions

    Individual income taxation, asset taxation and consumption taxation

    1. Revisions to the housing loan tax credit
    2. Fixed asset taxation
    3. Consumption taxation
    4. Other revisions

    International taxation

    1. Revisions to the special measure on tax book value reduction of subsidiary shares (a reform enacted in FY2020)
    2. Revisions to the earnings stripping rules

    Tax administration

    1. Safe harbor rules to facilitate a smooth transition to the electronic data retention system for transaction data pertaining to electronic transactions
    2. Measures addressing flagrantly malevolent taxpayers and taxpayers that do not fulfill their book-keeping obligations

    *Please note that the contents of this newsletter may be partially revised, deleted or added to in response to future Diet deliberations on the reform bill.

    Newsletters and alerts in English

    Webcast

  • 2021 Japan tax reform

    Overview of the major amendments and revisions 

    Corporate taxation

    1. Revisions to the general R&D tax incentive
    2. Introduction of a digital transformation (DX) investment promotion tax incentive
    3. Introduction of a tax incentive to promote carbon neutrality investments
    4. Special measure concerning the deduction limit of net operating losses (NOLs)
    5. Introduction of a tax measure to encourage M&As compensated through the utilization of shares
    6. Revision of the tax incentives to encourage wage increases and investments
    7. Introduction of a tax incentive to help SMEs with the consolidation of their managerial resources
    8. Other

    Individual taxation and asset taxation

    1. Tax rules related to housing
    2. Fixed asset tax
    3. Other

    Tax administration

    1. Revision of the electronic books maintenance rules
    2. Revision of obligations to affix seal impressions on tax-related documents
    3. Other

    Other

    1. Tax measures to facilitate the development of international financial hubs
    2. Revision of the treatment of taxes withheld in foreign countries in relation to dividends distributed by foreign subsidiaries
    3. Other

    *Please note that the contents of this newsletter may be partially revised, deleted or added to in response to future Diet deliberations on the reform bill.

    Newsletters and alerts in English

    Webcast

  • 2020 Japan tax reform

    Overview of the major amendments and revisions 

    Corporate taxation

    1.  Revision of the consolidated taxation regime
    2.  Establishment of measures pertaining to open innovation
    3.  Tax measures to encourage investment and salary increases
    4.  5G infrastructure (5th generation mobile communication systems)
    5.  Revisions of the regional revitalization tax rules
    6.  Others

    International taxation

    1.  Addressing schemes which incorporate dividends received from subsidiaries and subsidiary share transfers
    2.  Revision of the controlled foreign company (CFC) regime
    3.  Revision of the scope of foreign taxes eligible as foreign tax credits
    4.  Revision of the scope of non-qualified interest expenses under the earnings stripping rules
    5.  Revisions to the reporting regulations for the automatic exchange of financial account information concerning nonresidents (data exchange pursuant to the Common Reporting Standards (CRS))

    Individual income taxation, tax administration and other reforms

    1.  Individual income taxation
    2.  Tax administration
    3.  Other reforms

    *Please note that the contents of this newsletter may be partially revised, deleted or added to in response to future Diet deliberations on the reform bill.

    Newsletters and alerts in English

    Webcast

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