Where, for taxable purchases made in Japan by a business operator (excluding a business operator that is exempt from the obligation to pay consumption tax pursuant to the main clause of Article 9, paragraph (1) of the New Consumption Tax Act) during the period from the 2023 Effective Date to the day on which six years have elapsed from the 2023 Effective Date (limited to those made in a taxable period for which taxable sales in the base period are 100,000,000 yen or less, or for which taxable sales in the specified period (meaning taxable sales in the specified period prescribed in Article 9-2, paragraph (1) of the Consumption Tax Act) are 50,000,000 yen or less), the amount of consideration paid for those taxable purchases is small, as specified by Cabinet Order, then with respect to the application of Article 30, paragraph (7) of the New Consumption Tax Act, the phrase "books and invoices, etc. relating to the deduction of the amount of tax on taxable purchases, etc. for the taxable period (books only, as to the amount of tax on taxable purchases, etc. in a case specified by Cabinet Order, such as where it is difficult to receive delivery of invoices, etc. or where it relates to a specified taxable purchase)" in that paragraph is deemed to be replaced with "books relating to the deduction of the amount of tax on taxable purchases, etc. for the taxable period". In this case, the provisions of the preceding two Articles do not apply to those taxable purchases.

The provisions then in force continue to govern the application of Article 38, paragraphs (1) through (3) of the Supplementary Provisions of the Act Partially Amending the Income Tax Act, etc. (Act No. 9 of 2015; hereinafter in this Article referred to as the "2015 Amendment Act") to taxable purchases prescribed in Article 2, paragraph (1), item (xii) of the Consumption Tax Act that a business operator (meaning a business operator prescribed in Article 2, paragraph (1), item (iv) of the Consumption Tax Act; the same applies hereinafter in this Article) made in Japan during the period from the application date of the new Consumption Tax Act prescribed in Article 35 of the Supplementary Provisions of the 2015 Amendment Act to September 30, 2023 (hereinafter in this Article referred to as the "former law application period") and that relate to the supply of telecommunications services (meaning the supply of telecommunications services prescribed in Article 2, paragraph (1), item (viii)-3 of the Consumption Tax Act, and excluding those that fall under the provision of telecommunications services for businesses prescribed in Article 2, paragraph (1), item (viii)-4 of the Consumption Tax Act; the same applies hereinafter in this Article) received from a foreign business operator prescribed in Article 2, paragraph (1), item (iv)-2 of the Consumption Tax Act, and to the application of Article 38, paragraphs (4) and (5) of the Supplementary Provisions of the 2015 Amendment Act to the supply of telecommunications services made in Japan during the former law application period by a business operator that received registration pursuant to Article 39, paragraph (1) of the Supplementary Provisions of the 2015 Amendment Act as in force before amendment by the provisions of Article 18 (limited to the provision amending Article 35 of the Supplementary Provisions of the 2015 Amendment Act, the provision amending Article 36, paragraph (1) of the Supplementary Provisions of the 2015 Amendment Act, and the provisions amending Articles 38 through 40 of the Supplementary Provisions of the 2015 Amendment Act in that Article).

With regard to the application of penal provisions to acts committed before this Act (or, for the provisions set forth in the items of Article 1 of the Supplementary Provisions, those provisions; the same applies hereinafter in this Article) comes into effect and to acts committed after this Act comes into effect in the cases where the provisions then in force continue to govern pursuant to the provisions of these Supplementary Provisions, the provisions then in force continue to govern.

Beyond what is provided for in these Supplementary Provisions, transitional measures necessary in connection with the enforcement of this Act are specified by Cabinet Order.

In introducing the reduced tax rate system for consumption tax (including local consumption tax; the same applies hereinafter in this Article and the following Article), the government is to take the following measures in order to secure stable permanent financial resources, while firmly maintaining the fiscal consolidation target (referred to simply as the "fiscal consolidation target" in item (ii)) stated in the Basic Policy on Economic and Fiscal Management and Reform 2015 (referred to as "Basic Policy 2015" in item (ii)), which was decided by the Cabinet on June 30, 2015, and in accordance with the basic concept concerning the manner of securing stable financial resources for social security shown in Article 2 of the Act on Promotion of Social Security System Reform (Act No. 64 of 2012), Article 1 of the Act Partially Amending the Consumption Tax Act, etc., and Other Matters to Carry Out a Drastic Reform of the Tax System for Securing Stable Financial Resources for Social Security, etc., and Article 28 of the Act on the Promotion of Reform to Establish a Sustainable Social Security System (Act No. 112 of 2013).

①In introducing the reduced tax rate system for consumption tax, the government is to put in place the system necessary for making thorough preparations so that no confusion arises, to make the reduced tax rate system for consumption tax widely known and respond to consultations concerning the preparations of business operators, and, while verifying the state of preparations of business operators and the state of the government's efforts, to take, as necessary, the measures necessary to contribute to the smooth introduction and operation of the reduced tax rate system for consumption tax.

②From the viewpoint of ensuring the smooth operation of the reduced tax rate system for consumption tax and proper taxation, the government is to, while promoting the advancement of the management of small and medium-sized business operators, verify, targeting a period within three years after the introduction of the reduced tax rate system for consumption tax, the state of preparations of business operators for the introduction of the qualified invoice, etc. preservation method and its possible impact on transactions between business operators, the impact of the introduction of the reduced tax rate system for consumption tax on the simplified taxation system, and the state of application of the transitional measures accompanying the introduction of the reduced tax rate system for consumption tax, and, where it finds it necessary, take legislative and other necessary measures based on the results.