Consumption Tax Act

In the case where a business operator that operates a tax-free shop has made, to a person eligible for tax-free purchase (meaning a non-resident prescribed in Article 6, paragraph (1), item (vi) (Definitions) of the Foreign Exchange and Foreign Trade Act (Act No. 228 of 1949) who stays in Japan with the landing permission prescribed in Articles 14 through 18 (Permission for Landing) of the Immigration Control and Refugee Recognition Act (Cabinet Order No. 319 of 1951), who stays in Japan with the status of residence of "Diplomat" or "Official" in Appended Table I (1) of that Act or the status of residence of "Temporary Visitor" in Appended Table I (3) of that Act, or any other person specified by Cabinet Order; the same applies hereafter in this Article), a transfer of goods that are purchased by the method specified by Cabinet Order for the purpose of export (excluding goods specified by Ministry of Finance Order as goods highly likely to be purchased for an unlawful purpose concerning consumption tax, and those purchased goods in the case where the transfer of the purchased goods is one on which consumption tax is not to be imposed under Article 6, paragraph (1); hereinafter in this Article referred to as "tax-exempt goods") (limited to the case where the total amount of consideration prescribed in Article 28, paragraph (1) pertaining to the tax-exempt goods transferred to that person eligible for tax-free purchase at the same tax-free shop on the same day is equal to or more than the amount specified by Cabinet Order), and that person eligible for tax-free purchase has obtained, as provided by Cabinet Order, the confirmation of the director-general of a customs house as to the export of those tax-exempt goods (limited to where the confirmation is obtained within 90 days from the day of purchase), consumption tax is exempted for the transfer of those tax-exempt goods.

A business operator that operates the tax-free shop that made the transfer referred to in the preceding paragraph must, as provided by Cabinet Order, provide to the Commissioner of the National Tax Agency without delay the electronic or magnetic record pertaining to that transfer (meaning an electronic or magnetic record prescribed in Article 2, item (iii) (Definitions) of the Act on Special Provisions concerning Preservation Methods for Books and Documents Related to National Tax Prepared by Means of Computers (Act No. 25 of 1998); the same applies in the following paragraph) that is specified by Cabinet Order (hereinafter in this Article referred to as "purchase record information"). In this case, the Commissioner of the National Tax Agency who has been provided with the purchase record information is to, as provided by Cabinet Order, provide that purchase record information to the director-general of a customs house without delay.

Where the director-general of a customs house has made the confirmation referred to in paragraph (1) based on the purchase record information provided under the provisions of the preceding paragraph, the director-general is to, as provided by Cabinet Order, provide to the Commissioner of the National Tax Agency, for each piece of that purchase record information and without delay, an electronic or magnetic record recording a statement to the effect that the director-general has made that confirmation (hereinafter referred to in this paragraph and the following paragraph as "customs confirmation information"). In this case, the Commissioner of the National Tax Agency who has received the provision of customs confirmation information is to, as provided by Cabinet Order, provide that customs confirmation information without delay to the business operator that operates the tax-free shop that provided the purchase record information pertaining to that customs confirmation information.

The provisions of paragraph (1) do not apply where the business operator that operates the tax-free shop that made the transfer referred to in that paragraph does not retain, as provided by Cabinet Order, the purchase record information that it provided under the provisions of the first sentence of paragraph (2) with regard to that transfer and the customs confirmation information provided under the provisions of the second sentence of the preceding paragraph; provided, however, that this does not apply where that business operator has proved that it was unable to retain that purchase record information and that customs confirmation information due to a disaster or other unavoidable circumstances.

A person eligible for tax-free purchase who has obtained the confirmation of the director-general of the customs house referred to in paragraph (1) (including a person who has ceased to fall under the category of a person eligible for tax-free purchase after making a purchase at a tax-free shop by the method specified by Cabinet Order prescribed in that paragraph; the same applies in the following paragraph) must, without delay, export the tax-exempt goods for which that confirmation has been obtained.

Where tax-exempt goods for which the confirmation of the director-general of the customs house referred to in paragraph (1) has been obtained are no longer to be exported, the director-general of the customs house is to immediately collect, from the person eligible for tax-free purchase who obtained that confirmation, consumption tax equivalent to the amount of consumption tax exempted under the provisions of that paragraph for the transfer of those tax-exempt goods.

the business operator currently has no arrears of national taxes (limited to those for which collection of the amount of taxes in arrears is extremely difficult);

the business operator is not a person whose permission for a tax-free shop has been revoked pursuant to the following paragraph (excluding the part pertaining to item (iii)) and for whom three years have not elapsed from the day of the revocation, and there are no other circumstances by which the business operator is found to be particularly unsuitable as a business operator that operates a tax-free shop.

The district director may revoke the permission under the preceding paragraph for a tax-free shop if the business operator that operates the tax-free shop prescribed in that paragraph falls under any of the cases set forth in the following items.

where the provisions of laws and regulations concerning consumption tax have been violated;

where the procedures and other conditions for transferring tax-exempt goods at that tax-free shop are found to be particularly inappropriate;

where it is found that there is an impediment to the confirmation of the director-general of the customs house referred to in paragraph (1) due to deficiencies in or false records in the purchase record information provided under the provisions of the first sentence of paragraph (2), or other circumstances.

Where a business operator that intends to establish a temporary sales outlet (meaning a sales outlet established for a period fixed at seven months or less for the purpose of transferring tax-exempt goods to persons eligible for tax-free purchase) (limited to a business operator that operates a tax-free shop prescribed in paragraph (7)) and that has obtained the approval under the following paragraph submits, by the day before the day of establishing that temporary sales outlet, to the district director having jurisdiction over its place for tax payment a written notification stating the period during which it intends to establish that temporary sales outlet and other matters specified by Ministry of Finance Order, with the documents specified by Ministry of Finance Order attached, the provisions of paragraphs (1) through (5) apply, only for that period, deeming that temporary sales outlet to be a tax-free shop prescribed in paragraph (7).

A business operator that seeks to be subject to the application of the preceding paragraph must obtain, in advance, the approval of the district director having jurisdiction over its place for tax payment, as provided by Cabinet Order.

The director-general of a customs house may, as provided by Cabinet Order, delegate part of the authority pertaining to collection under the provisions of paragraph (6), and of the authority based on the provisions of laws and regulations concerning the consumption tax that is to be collected, to the head of a branch office of the customs house or other customs house office.

In addition to what is provided for in the preceding paragraphs, matters necessary for the application of the provisions of this Article are specified by Cabinet Order.