Tax-free shopping for all purchases over 5,000 yen in Japan to be implemented as early as 2014

▲The Japanese government plans to offer full tax exemptions on all goods purchased by foreign tourists in Japan and lower the refund threshold to 5,000 yen, with implementation possibly starting in 2014. The image above is for illustrative purposes only. (Photo/ Illustration/ Ingimage)

Travel Center / Comprehensive Report

Japan plans to raise its consumption tax from 5% to 10% next year, which is expected to drive up prices. With Tokyo having won the bid to host the 2020 Olympics, the Japanese government aims to attract more foreign tourists and boost consumption by expanding tax exemption on all goods purchased by foreigners—not just electronics and clothing as before. The new policy could take effect as early as 2014.

Previously, in Japan, only electronics and clothing were tax-free for shoppers. Items such as popular Japanese cosmetics and skincare products favored by women, as well as commonly purchased souvenirs like candies and cookies, still included consumption tax. Now, to attract more foreign visitors, the Japanese government plans to make all goods purchased by foreigners tax-free starting in 2014. The refund threshold will also be reduced from the previous 10,000 yen (about NT$2,880) per store to just 5,000 yen (about NT$1,440).

In addition, to simplify the refund process, the Japanese government also plans to allow foreign consumers to pay the non-tax-inclusive amount directly at checkout. Alternatively, similar to the South Korean system, customers may be able to present their tax refund forms and passports at the airport to receive cash refunds (currently, no such mechanism exists at Japanese airports). The actual implementation is expected to begin as early as next year (2014).

%Explore the diverse culture, cuisine, and shopping experiences in Japan. The image below shows a street view of Takeshita Street in Tokyo. (Photo/ MIKA’s Foodie Adventure Log)