This Act comes into effect on April 1, 2025; provided, however, that the provisions set forth in the following items come into effect on the dates specified respectively in those items:

①The provisions of Article 2, paragraph (1) (limited to the part concerning items (xxxii), (xxxiii), and (xxxiv)) of the Income Tax Act as amended by Article 1 (hereinafter referred to as "the new Income Tax Act") apply to income tax for 2025 and subsequent years, and the provisions then in force continue to govern income tax for 2024 and prior years.

②A person who, before December 1, 2025, filed a Tax Return under Article 125 or Article 127 of the Income Tax Act for income tax for that year, or a person who, before that date, received a determination for income tax for that year, may, if a change is to arise, as a result of the application of the provisions of Article 2, paragraph (1), item (xxxii), (xxxiii), or (xxxiv) of the new Income Tax Act, in the particulars stated in the Tax Return or the particulars pertaining to the determination (or, if a Reassessment was made with regard to those particulars before that date, the particulars after the Reassessment), file a request for Reassessment under Article 23, paragraph (1) of the Act on General Rules for National Taxes with the district director within five years from that date with regard to the particulars in which the change is to arise.

①The provisions of Article 28 of the new Income Tax Act apply to income tax for 2025 and subsequent years, and the provisions then in force continue to govern income tax for 2024 and prior years.

②A person who, before December 1, 2025, filed a Tax Return under Article 125 or Article 127 of the Income Tax Act for income tax for that year, or a person who, before that date, received a determination for income tax for that year, may, if a change is to arise, as a result of the application of the provisions of Article 28 of the new Income Tax Act, in the particulars stated in the Tax Return or the particulars pertaining to the determination (or, if a Reassessment was made with regard to those particulars before that date, the particulars after the Reassessment), file a request for Reassessment under Article 23, paragraph (1) of the Act on General Rules for National Taxes with the district director within five years from that date with regard to the particulars in which the change is to arise.

①The provisions then in force continue to govern income tax for 2025 and prior years of an individual who, before the date on which this Act comes into effect (hereinafter referred to as "the effective date"), made a lease transfer as prescribed in Article 65, paragraph (1) of the Income Tax Act prior to the amendment by Article 1 (hereinafter referred to as "the former Income Tax Act").

②With regard to the calculation of the amount of business income for each tax year from 2026 onward relating to former lease transfers (meaning lease transfers prescribed in that paragraph that are made in any year up to and including 2027; the same applies hereinafter in this Article) of an individual who has made a lease transfer as prescribed in Article 65, paragraph (1) of the former Income Tax Act before the effective date (including an individual who received a transfer of a contract for a lease transfer prescribed in that paragraph that was made before the effective date), the provisions of Article 65 of the former Income Tax Act (including where the calculation is made in accordance with that Article pursuant to the provisions of Article 165, paragraph (1) of the former Income Tax Act) remain in force. In this case, the term "case" in the proviso to Article 65, paragraph (1) of the former Income Tax Act is deemed to be replaced with "case (excluding a case falling under the case set forth in Article 4, paragraph (3), item (i) (Transitional Measures Concerning the Timing for Attributing Revenue and Expenses from Lease Transfers) of the Supplementary Provisions of the Act Partially Amending the Income Tax Act, etc. (Act No. 13 of 2025; referred to as the "2025 Amendment Act" in this paragraph and the following paragraph)) or a case where the provisions of Article 4, paragraph (3) or (4) of the Supplementary Provisions of the 2025 Amendment Act have been applied", the phrase "for the year" is deemed to be replaced with "for the year or for a year from the base year prescribed in paragraph (3) of that Article onward", and the phrase "are included." in paragraph (2) of that Article is deemed to be replaced with "are included; provided, however, that this does not apply to the calculation of the amount of business income for a year from the base year prescribed in paragraph (3) of that Article onward if the provisions of Article 4, paragraph (3) or (4) of the Supplementary Provisions of the 2025 Amendment Act have been applied, in any year from the year following the year that includes that date onward, with regard to the amount of revenue and the amount of expenses from that lease transfer.".

③If the amount of revenue and the amount of expenses from a former lease transfer to which the application relates, of an individual subject to the provisions of the main clause of Article 65, paragraph (1) or the main clause of paragraph (2) of the former Income Tax Act that remains in force pursuant to the provisions of the preceding paragraph (hereinafter referred to as the "former Income Tax Act kept in effect" in this Article) (including where the calculation is made in accordance with those provisions pursuant to the provisions of Article 165, paragraph (1) of the former Income Tax Act; the same applies hereinafter in this Article), fall under any of the cases set forth in the following items, that amount of revenue and amount of expenses (excluding those included in gross revenue and necessary expenses in calculating the amount of business income for the tax years of the years before the year specified in the relevant item; referred to respectively as the "unrecorded revenue amount" and the "unrecorded expense amount" in the following paragraph) are included in gross revenue and necessary expenses in calculating the amount of business income for the tax year of the year specified in the relevant item (referred to as the "reference year" in the following paragraph and paragraph (5)):

④In the case where the amount of revenue and the amount of expenses from a former lease transfer to which the application relates, of an individual subject to the provisions of the main clause of Article 65, paragraph (1) or the main clause of paragraph (2) of the former Income Tax Act kept in effect, fall under any of the cases set forth in the items of the preceding paragraph, if the unrecorded revenue amount relating to that former lease transfer exceeds the unrecorded expense amount relating to that former lease transfer, notwithstanding the provisions of that paragraph, the amounts set forth in item (i) (or, for the year that includes the date on which the business was discontinued and for a year in which the amounts set forth in item (i) exceed the respective amounts set forth in item (ii), the amounts set forth in item (ii)) are included in gross revenue and necessary expenses in calculating the amount of business income for each tax year from the reference year onward:

⑤The provisions of the preceding paragraph apply only if the Tax Return for income tax for the tax year of the reference year contains a statement to the effect that the provisions of that paragraph are to be applied.

⑥Even if the Tax Return referred to in the preceding paragraph is not filed or if a Tax Return is filed that is not filled out as referred to in that paragraph, the district director may apply the provisions of paragraph (4) on finding there to be unavoidable circumstances for the failure to file the Tax Return or fill it out in that manner.

⑦The number of months referred to in paragraph (4), item (i) is calculated according to the calendar, and any fraction of less than one month is rounded down.

⑧Special provisions on the treatment of the amount of revenue and the amount of expenses from former lease transfers in the case of the death or Absence From Japan of an individual to whom the provisions of the main clause of Article 65, paragraph (1) or the main clause of paragraph (2) of the former Income Tax Act kept in effect are being applied, and other matters necessary for the application of the provisions of paragraphs (2) through (4), are specified by Cabinet Order.

The provisions of Article 67-3 (limited to the part concerning paragraphs (3) and (4)) of the new Income Tax Act apply to a specified Trust Subject to Corporate Taxation as prescribed in paragraph (4), item (i) of that Article that takes effect on or after the effective date.

①The provisions of Article 84-2 (excluding the part concerning paragraph (2), items (ii) and (iii)) of the new Income Tax Act apply to income tax for 2025 and subsequent years.

②The provisions of Article 84-2 (limited to the part concerning paragraph (2), item (ii)) of the new Income Tax Act apply to income tax for 2026 and subsequent years.

③The provisions of Article 85 of the new Income Tax Act apply to income tax for 2025 and subsequent years, and the provisions then in force continue to govern income tax for 2024 and prior years.

④A person who, before December 1, 2025, filed a Tax Return under Article 125 or Article 127 of the Income Tax Act for income tax for that year, or a person who, before that date, received a determination for income tax for that year, may, if a change is to arise, as a result of the application of the provisions of Article 84-2 of the new Income Tax Act, in the particulars stated in the Tax Return or the particulars pertaining to the determination (or, if a Reassessment was made with regard to those particulars before that date, the particulars after the Reassessment), file a request for Reassessment under Article 23, paragraph (1) of the Act on General Rules for National Taxes with the district director within five years from that date with regard to the particulars in which the change is to arise.

①The provisions of Article 86 of the new Income Tax Act apply to income tax for 2025 and subsequent years, and the provisions then in force continue to govern income tax for 2024 and prior years.

②A person who, before December 1, 2025, filed a Tax Return under Article 125 or Article 127 of the Income Tax Act (including as applied mutatis mutandis pursuant to Article 166 of that Act) for income tax for that year, or a person who, before that date, received a determination for income tax for that year, may, if a change is to arise, as a result of the application of the provisions of Article 86 of the new Income Tax Act, in the particulars stated in the Tax Return or the particulars pertaining to the determination (or, if a Reassessment was made with regard to those particulars before that date, the particulars after the Reassessment), file a request for Reassessment under Article 23, paragraph (1) of the Act on General Rules for National Taxes with the district director within five years from that date with regard to the particulars in which the change is to arise.

The provisions of Article 120, paragraph (3) (limited to the part concerning item (iii)) of the new Income Tax Act (including as applied mutatis mutandis pursuant to Article 122, paragraph (3), Article 123, paragraph (3), Article 125, paragraph (4), and Article 127, paragraph (4) of the Income Tax Act) apply where a Tax Return for income tax for 2025 or subsequent years is filed on or after December 1, 2025, and the provisions then in force continue to govern where a Tax Return was filed before that date and where a Tax Return for income tax for 2024 or prior years is filed on or after that date.

①The provisions of Part IV, Chapter II, Section 1, Article 190 (limited to the part concerning item (ii), (c)), and Appended Tables II through IV of the new Income Tax Act apply to a salary or other wage as prescribed in Article 183, paragraph (1) of the Income Tax Act (hereinafter referred to as a "salary or other wage" in this Article and Article 37-2, paragraph (1) of the Supplementary Provisions) that is to be paid on or after January 1, 2026, and the provisions then in force continue to govern a salary or other wage that is to be paid before that date.

②The provisions of Article 190 (limited to the part concerning item (ii), (e)) and Appended Table V of the new Income Tax Act apply to a salary or other wage that is to be paid during 2025 and for which the last payment is made on or after December 1 of that year, and the provisions then in force continue to govern a salary or other wage that is to be paid during 2025 and for which the last payment is made before December 1 of that year.

③For the purpose of applying the provisions of Article 190 of the new Income Tax Act during the period from December 1, 2025 to December 31, 2025, the phrase "that specified relative is a person about whom the entry referred to in Article 194, paragraph (5) or" in item (ii), (e) of that Article is deemed to be replaced with "that specified relative is a person about whom the entry referred to in", and the phrase "those provisions" is deemed to be replaced with "that paragraph".

④The provisions of Article 194, paragraphs (1) and (5) and Article 195, paragraphs (1), (4), and (5) of the new Income Tax Act apply to a salary income earner's return for deduction for Dependents, etc. as prescribed in Article 194, paragraph (8) of the Income Tax Act and a return for deduction for Dependents, etc. regarding secondary salaries as prescribed in Article 195, paragraph (6) of that Act that are submitted with regard to a salary or other wage to be received on or after January 1, 2026, and the provisions then in force continue to govern a salary income earner's return for deduction for Dependents, etc. as prescribed in Article 194, paragraph (8) of that Act and a return for deduction for Dependents, etc. regarding secondary salaries as prescribed in Article 195, paragraph (6) of that Act that were submitted with regard to a salary or other wage to be received before that date.

⑤The provisions of Article 195-3 of the new Income Tax Act apply to a salary income earner's return for special deduction for specified relatives as prescribed in paragraph (3) of that Article that is submitted with regard to a salary or other wage that is to be received during 2025 and for which the last payment is received on or after December 1 of that year.

⑥The provisions of Article 198, paragraph (4) of the new Income Tax Act apply to a return for deduction for Dependents, etc. as prescribed in that paragraph that is submitted with regard to a salary or other wage that is to be received during 2025 and for which the last payment is received on or after December 1 of that year, and the provisions then in force continue to govern a return for deduction for Dependents, etc. as prescribed in Article 198, paragraph (4) of the former Income Tax Act that was submitted with regard to a salary or other wage that is to be received during 2025 and for which the last payment is received before December 1 of that year.

⑦For the purpose of applying the provisions of Article 198 of the new Income Tax Act during the period from December 1, 2025 to December 31, 2025, the term "relatives for withholding deduction" in paragraph (4) of that Article is deemed to be replaced with "claimable dependents".

①The provisions of Articles 203-3 and 203-4-2 of the new Income Tax Act apply to a public pension or retirement package as prescribed in Article 203-2 of the Income Tax Act (hereinafter referred to as a "public pension or retirement package" in this paragraph through paragraph (3) and in Article 37 and Article 37-2, paragraph (2) of the Supplementary Provisions) that is to be paid on or after January 1, 2026, and the provisions then in force continue to govern a public pension or retirement package that is to be paid before that date.

②The provisions of Article 203-6, paragraphs (1), (3), and (7) of the new Income Tax Act apply to a return for Dependents, etc. by a recipient of a public pension or retirement package as prescribed in Article 203-6, paragraph (8) of the Income Tax Act that is submitted with regard to a public pension or retirement package to be received on or after January 1, 2026, and the provisions then in force continue to govern a return for Dependents, etc. by a recipient of a public pension or retirement package as prescribed in that paragraph that was submitted with regard to a public pension or retirement package to be received before that date.

③If a person paying to a Resident a public pension or retirement package specified by Cabinet Order (hereinafter referred to as a "specified public pension or retirement package" in this paragraph, the following paragraph, and paragraph (1) of the following Article) makes the last payment of a specified public pension or retirement package in the year on or after December 1, 2025, and the total amount of income tax set forth in item (i) exceeds the tax amount set forth in item (ii) calculated based on the circumstances as of the time of the last payment of a specified public pension or retirement package in the year on or after that date, the excess amount must be Appropriated to cover the income tax to be collected upon the last payment of a specified public pension or retirement package in the year on or after that date:

④In the case referred to in the preceding paragraph, if, after an Appropriation of the excess amount prescribed in that paragraph to the income tax to be collected upon the last payment of a specified public pension or retirement package in the year on or after December 1, 2025, there remains an excess amount that could not be fully covered by that Appropriation (or, if the excess amount includes any amount that has not yet been collected, the amount obtained by deducting the amount equivalent to the uncollected portion; referred to as the "overpaid amount" in this paragraph and the following paragraph), the payer prescribed in the preceding paragraph refunds the overpaid amount.

⑤The procedures for the refund of the overpaid amount and other matters necessary for the application of the provisions of the preceding two paragraphs are specified by Cabinet Order.

①For the purpose of applying the provisions of paragraph (3) through paragraph (5) of the preceding Article in the case where the payer prescribed in paragraph (3) of that Article collects income tax and special income tax for reconstruction on a specified public pension or retirement package paid to the Resident referred to in that paragraph last in the year on or after December 1, 2025, the phrase "amount of income tax set forth" in paragraph (3) of that Article is deemed to be replaced with "amount of income tax and special income tax for reconstruction set forth", the phrase "tax amount set forth" is deemed to be replaced with "total amount set forth", the phrase "to the income tax" is deemed to be replaced with "to the income tax and special income tax for reconstruction", the phrase "total amount" in item (i) of that paragraph is deemed to be replaced with "total amount, together with the amount of special income tax for reconstruction that has been collected or is to be collected pursuant to Article 28, paragraph (1) of the Act on Special Measures for Securing the Financial Resources Necessary to Implement Measures for Reconstruction following the Great East Japan Earthquake (referred to as the "Special Measures Act" in the following item),", the phrase "tax amount" in item (ii) of that paragraph is deemed to be replaced with "total of the tax amount and the tax amount to be collected pursuant to Article 28, paragraph (1) of the Special Measures Act", the phrase "income tax" in paragraph (4) of that Article is deemed to be replaced with "income tax and special income tax for reconstruction", and the phrase "the preceding two paragraphs" in paragraph (5) of that Article is deemed to be replaced with "the preceding two paragraphs as applied with the replacement of terms pursuant to paragraph (1) of the following Article".

②The provisions of Article 28, paragraphs (9) and (11) of the Act on Special Measures for Securing the Financial Resources Necessary to Implement Measures for Reconstruction following the Great East Japan Earthquake apply mutatis mutandis in the case where there has been an Appropriation or refund of income tax and special income tax for reconstruction under paragraph (3) or (4) of the preceding Article as applied with the replacement of terms pursuant to the preceding paragraph.

The provisions of Article 224-3, paragraph (4) (limited to the part concerning item (ii)) of the new Income Tax Act apply to the delivery of redemption money or a similar asset as prescribed in that paragraph that is made on or after April 1, 2026.

The provisions then in force continue to govern the application of penal provisions to conduct engaged in 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 conduct engaged in after this Act comes into effect in the cases in which prior laws are to continue to govern pursuant to the provisions of these Supplementary Provisions.

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

①In light of structural changes in Japan's economy and society, the government is to conduct a review of fundamental reform of income tax, including a reconsideration of how Each Class of Income is to be taxed and of how various deductions, beginning with personal deductions, are to be structured, and is to take the necessary legislative measures based on the results of that review.

②In conducting the review referred to in the preceding paragraph, with regard to addressing the issue that the real burden of income tax increases when prices rise because the amounts of the basic deduction and similar deductions are fixed, specific measures are to be reviewed in line with the basic direction of raising the amounts of the basic deduction and similar deductions in a timely manner in light of rising prices and other factors, while also taking into account the impact on the administrative burden of persons obliged to perform withholding of income tax.

By the end of fiscal 2025, the government is to conduct a review, together with the review referred to in the preceding Article, of securing, through measures in revenue and expenditure, the financial resources required to implement the special provisions on the basic deduction for income tax, and is to take the necessary measures based on the results of that review.