Consumption Tax Act

Except as otherwise provided in these Supplementary Provisions, the provisions of the Consumption Tax Act as amended by the provisions of Article 3 (hereinafter referred to as the "New Consumption Tax Act" through Article 21 of the Supplementary Provisions) apply to consumption tax pertaining to transfers, etc. of assets (meaning transfers, etc. of assets prescribed in Article 2, paragraph (1), item (viii) of the Consumption Tax Act; the same applies hereinafter through Article 19 of the Supplementary Provisions) conducted in Japan on or after April 1, 2028 by a business operator (meaning a business operator prescribed in item (iv) of that paragraph; the same applies hereinafter through Article 21 of the Supplementary Provisions), taxable purchases (meaning taxable purchases prescribed in item (xii) of that paragraph; the same applies hereinafter in this Article) made in Japan on or after that day by a business operator, and taxable goods (meaning taxable goods prescribed in item (xi) of that paragraph; the same applies hereinafter in this Article) taken out of a bonded area (meaning a bonded area prescribed in item (ii) of that paragraph; the same applies hereinafter in this Article) on or after that day, and the provisions then in force continue to govern consumption tax pertaining to transfers, etc. of assets conducted in Japan by a business operator before that day, taxable purchases made in Japan by a business operator before that day, and taxable goods taken out of a bonded area before that day.

Where, for the taxable period that includes April 1, 2028 (meaning a taxable period prescribed in Article 19, paragraph (1) of the Consumption Tax Act (including a period deemed to be a single taxable period pursuant to the provisions of paragraph (2) or (4) of that Article); the same applies hereinafter through Article 21 of the Supplementary Provisions) of a business operator whose obligation to pay consumption tax is exempted under the main clause of Article 9, paragraph (1) of the Consumption Tax Act prior to amendment by the provisions of Article 3, the taxable sales in the base period of that taxable period (meaning the taxable sales in the base period prescribed in Article 9, paragraph (1) of the New Consumption Tax Act; the same applies hereinafter through Article 21 of the Supplementary Provisions) or the taxable sales in the specified period (meaning the taxable sales in the specified period prescribed in Article 9-2, paragraph (1) of the Consumption Tax Act; the same applies in the following paragraph and paragraph (4)), calculated on the assumption that the New Consumption Tax Act had been in effect from the first day of the base period of that taxable period (meaning the base period prescribed in Article 2, paragraph (1), item (xiv) of the Consumption Tax Act; the same applies hereinafter in this Article and paragraph (1) of the following Article) or of the specified period (meaning the specified period prescribed in Article 9-2, paragraph (4) of the Consumption Tax Act; the same applies in the following paragraph and paragraph (4)) and on the assumption that the provisions of Article 15-3, paragraph (1) of the New Consumption Tax Act apply to the transfers, etc. of assets pertaining to the designation of a business operator that has been designated under Article 15-3, paragraph (2) of the New Consumption Tax Act pursuant to the provisions of the first sentence of Article 20, paragraph (2) of the Supplementary Provisions, exceeds 10 million yen, the provisions of the main clause of Article 9, paragraph (1) of the New Consumption Tax Act do not apply to taxable transfers, etc. of assets (meaning taxable transfers, etc. of assets prescribed in Article 2, paragraph (1), item (ix) of the Consumption Tax Act, excluding those that fall under specified transfers, etc. of assets prescribed in item (viii)-2 of that paragraph; the same applies in paragraph (3) and Article 21, paragraph (4) of the Supplementary Provisions) and specified taxable purchases (meaning specified taxable purchases prescribed in Article 5, paragraph (1) of the Consumption Tax Act; the same applies in Article 21, paragraph (4) of the Supplementary Provisions) conducted by that business operator during the period from the first day of that month to the last day of that taxable period. In this case, for the application of the provisions of Article 57, paragraph (1) of the Consumption Tax Act, the phrase "Article 11 or Article 12, paragraphs (1) through (6)" in item (i) of that paragraph is deemed to be replaced with "Article 11, Article 12, paragraphs (1) through (6) or Article 18, paragraph (1) of the Supplementary Provisions of the Act Partially Amending the Income Tax Act, etc. (Act No. 12 of 2026)".

With regard to the taxable sales in the base period or the taxable sales in the specified period for a taxable period beginning on or after the day following April 1, 2028, where the first day of that base period or that specified period is before the first day of that month, they are to be calculated under the provisions of Article 9, paragraph (2) or Article 9-2, paragraph (2) of the Consumption Tax Act, on the assumption that the New Consumption Tax Act had been in effect from the first day of that base period or that specified period and on the assumption that the provisions of Article 15-3, paragraph (1) of the New Consumption Tax Act apply to the transfers, etc. of assets pertaining to the designation of a business operator that has been designated under Article 15-3, paragraph (2) of the New Consumption Tax Act pursuant to the provisions of the first sentence of Article 20, paragraph (2) of the Supplementary Provisions.

Where a business operator that, in the base period for a taxable period to which the provisions of paragraph (1) or the preceding paragraph apply, made transfers, etc. of assets that fall under a transfer of specified low-value assets (meaning a transfer of specified low-value assets prescribed in Article 2, paragraph (1), item (viii)-6 of the New Consumption Tax Act; the same applies in the following paragraph) has difficulty in calculating the taxable sales in the base period under the provisions of the preceding two paragraphs, the business operator may, notwithstanding the provisions of Article 9, paragraph (2) of the Consumption Tax Act, treat as the taxable sales in the base period the amount calculated by multiplying by four the taxable sales (meaning the balance remaining after deducting, from the total amount of consideration (meaning the amount of consideration prescribed in Article 28, paragraph (1) of the Consumption Tax Act) for taxable transfers, etc. of assets conducted in Japan during that period, the total tax-exclusive refunds, etc. of consideration for sales prescribed in Article 9, paragraph (2), item (i) of the Consumption Tax Act that were made during that period; the same applies in the following paragraph) for the period from October 1, 2027 to December 31, 2027, calculated on the assumption that the New Consumption Tax Act had been in effect from October 1, 2027 and on the assumption that the provisions of Article 15-3, paragraph (1) of the New Consumption Tax Act apply to the transfers, etc. of assets pertaining to the designation of a business operator that has been designated under Article 15-3, paragraph (2) of the New Consumption Tax Act pursuant to the provisions of the first sentence of Article 20, paragraph (2) of the Supplementary Provisions.

Where a business operator that, in the specified period for a taxable period to which the provisions of paragraph (1) or (2) apply, made transfers, etc. of assets that fall under a transfer of specified low-value assets has difficulty in calculating the taxable sales in the specified period under those provisions, the business operator may, notwithstanding the provisions of Article 9-2, paragraph (2) of the Consumption Tax Act, treat as the taxable sales in the specified period the amount calculated by multiplying by two the taxable sales for the period from October 1, 2027 to December 31, 2027, calculated on the assumption that the New Consumption Tax Act had been in effect from October 1, 2027 and on the assumption that the provisions of Article 15-3, paragraph (1) of the New Consumption Tax Act apply to the transfers, etc. of assets pertaining to the designation of a business operator that has been designated under Article 15-3, paragraph (2) of the New Consumption Tax Act pursuant to the provisions of the first sentence of Article 20, paragraph (2) of the Supplementary Provisions.

Where a business operator to which the provisions of paragraph (1) apply has succeeded to the business of a decedent by an inheritance prescribed in Article 10, paragraph (1) of the Consumption Tax Act that took place during the period from April 1, 2028 to the last day of the taxable period that includes that day, for the application of the provisions of that paragraph, the phrase "or under the provisions of Article 9-2, paragraph (1)" in that paragraph is deemed to be replaced with "under the provisions of Article 9-2, paragraph (1), or under the provisions of Article 18, paragraph (1) of the Supplementary Provisions of the Act Partially Amending the Income Tax Act, etc. (Act No. 12 of 2026)".

For the application of the provisions of Article 11, paragraph (1) of the Consumption Tax Act and Article 12, paragraph (5) of that Act to a merger prescribed in Article 11, paragraph (1) of the Consumption Tax Act or an absorption-type company split prescribed in Article 12, paragraph (5) of that Act that a business operator to which the provisions of paragraph (1) apply conducted during the period from April 1, 2028 to the last day of the taxable period that includes that day, the phrase "or under the provisions of Article 9-2, paragraph (1)" in those provisions is deemed to be replaced with "under the provisions of Article 9-2, paragraph (1), or under the provisions of Article 18, paragraph (1) of the Supplementary Provisions of the Act Partially Amending the Income Tax Act, etc. (Act No. 12 of 2026)".

Where an inheritance prescribed in Article 10, paragraph (1) of the Consumption Tax Act takes place on or after April 1, 2028, the taxable sales in the base period of the decedent prescribed in Article 10, paragraph (1) or (2) of the Consumption Tax Act are to be calculated under the provisions of Article 9, paragraph (2) of the Consumption Tax Act, where the first day of that base period is before the first day of that month, on the assumption that the New Consumption Tax Act had been in effect from the first day of that base period and on the assumption that the provisions of Article 15-3, paragraph (1) of the New Consumption Tax Act apply to the transfers, etc. of assets pertaining to the designation of a business operator that has been designated under Article 15-3, paragraph (2) of the New Consumption Tax Act pursuant to the provisions of the first sentence of paragraph (2) of the following Article.

With regard to the amount calculated as provided by Cabinet Order as the taxable sales in the period corresponding to the base period prescribed in each paragraph of Article 11 of the Consumption Tax Act in the case where a merger prescribed in Article 11, paragraph (1) or (3) of that Act has taken place on or after April 1, 2028, the amount calculated as provided by Cabinet Order as the taxable sales in the period corresponding to the base period prescribed in Article 12, paragraphs (1) through (4) of that Act in the case where a corporate split, etc. prescribed in Article 12, paragraph (7) of that Act has taken place, or the amount calculated as provided by Cabinet Order as the taxable sales in the period corresponding to the base period prescribed in Article 12, paragraph (5) or (6) of that Act in the case where an absorption-type company split prescribed in Article 12, paragraph (5) of that Act has taken place, where the first day of those periods is before the first day of that month, those amounts are to be calculated under the provisions of Cabinet Order based on the provisions of each paragraph of Article 11 or Article 12, paragraphs (1) through (6) of the Consumption Tax Act, on the assumption that the New Consumption Tax Act had been in effect from the first day of those periods and on the assumption that the provisions of Article 15-3, paragraph (1) of the New Consumption Tax Act apply to the transfers, etc. of assets pertaining to the designation of a business operator that has been designated under Article 15-3, paragraph (2) of the New Consumption Tax Act pursuant to the provisions of the first sentence of paragraph (2) of the following Article.

With regard to the amount calculated as provided by Cabinet Order as the taxable sales in the period corresponding to the base period prescribed in Article 12-3, paragraph (1) of the Consumption Tax Act in the case where the new establishment start date prescribed in that paragraph is on or after April 1, 2028, where the first day of that period is before the first day of that month, that amount is to be calculated under the provisions of Cabinet Order based on the provisions of Article 12-3, paragraph (1) of the Consumption Tax Act, on the assumption that the New Consumption Tax Act had been in effect from the first day of that period and on the assumption that the provisions of Article 15-3, paragraph (1) of the New Consumption Tax Act apply to the transfers, etc. of assets pertaining to the designation of a business operator that has been designated under Article 15-3, paragraph (2) of the New Consumption Tax Act pursuant to the provisions of the first sentence of paragraph (2) of the following Article.

The provisions of Article 15-3, paragraphs (2) and (3) of the New Consumption Tax Act apply from taxable periods ending on or after April 1, 2028.

No English for the wording before the change.