3.8 Other Principal Taxes

Section 3: Taxes in Japan


This section discusses the aspects of Japan’s tax system that are most relevant to a foreign corporation or individual investing in Japan. Emphasis is placed on corporate tax structures, tax treaties, and personal taxes.


3.1   Overview of Japanese Corporate Tax System for Investment in Japan

3.2   Domestic-Sourced Income

3.3   Overview of Corporate Income Taxes (Corporate Tax, Corporate Inhabitant Tax, Enterprise Tax)

3.4   Overview of Withholding Income Tax

3.5   Tax Treaties

3.6   Overview of Consumption Tax

3.7   Overview of Personal Tax System

3.8   Other Principal Taxes

3.9   Other Principal Corporate Taxation Regarding International Transactions

3.8 Other Principle Taxes
There are a variety of other taxes levied on income, the acquisition/ownership of assets, consumption and other transactions in addition to those described above. Taxes levied on the ownership of assets to which many businesses are subject include the fixed asset tax (depreciable property tax) and the city planning tax. Land, structures and depreciable assets for business use are subject to a fixed asset tax (depreciable property tax) of 1.4%, payable by the owners of said property as of January 1 each year. The city planning tax is surtax on the fixed asset tax, and is levied at a rate of 0.3% on land and structures within city planning zones. Companies in major cities such as Tokyo and Osaka having facilities exceeding 1,000 square meters in floor space and/or having more than 100 employees are subject to business office taxes. The tax rates are 600 yen per square meter of floor space and 0.25% of the total amount of employee salaries.

Furthermore, there is a registration and license tax levied for the registration of real estate/companies and the issue of business licenses, as well as a stamp duty payable as a tax on stipulated documents. Gift tax, inheritance tax and other special-purpose taxes must also be borne in mind.