Local Tax Act

Where the mayor of a municipality, having inspected under Article 325 an amended return submitted by a person liable for income tax, or documents relating to a reassessment or determination of income tax made by a national tax office, with respect to individual municipal inhabitant tax collected by the method of ordinary collection, finds it necessary to change the amount of tax assessed or to make an assessment, the mayor must immediately additionally collect the tax deficiency resulting from the change or the portion, of the tax amount that should have been assessed, that relates to the payment periods up to the day on which the determination was made (referred to as the "tax deficiency" in this Article), except where individual municipal inhabitant tax has already been assessed by applying the proviso to item (i) of Article 315 or item (ii) of that Article, or Article 316.

In the case of the preceding paragraph, a municipal tax collection official must add to the tax deficiency, and collect, an amount of delinquency charge equivalent to the amount calculated by multiplying the amount obtained by dividing the tax deficiency by the number of payment periods up to the day on which the determination was made by a rate of 14.6 percent per annum (7.3 percent per annum for the period until the day on which payment is to be made as stated in the tax notice relating to that tax deficiency, or the period until the day on which one month elapses from the day following that day), according to the number of days in the period from the day following each due date for payment under Article 320 (where the due date for payment has been extended, the extended due date for payment; the same applies in the following paragraph and paragraph (4)) until the date of payment.

Where, as a result of a person liable for income tax having submitted an amended return (excluding that submitted by a person liable for income tax who evaded income tax or received a refund of income tax by deception or other wrongful acts, upon foreseeing, because an investigation of that income tax had been conducted, that a reassessment of that income tax would be made, and that submitted after a person liable for income tax received a determination of income tax (referred to as a "specified amended return" in the following paragraph)), or a national tax office having made a reassessment of income tax (excluding a reassessment of that income tax made in respect of a person liable for income tax who evaded income tax or received a refund of income tax by deception or other wrongful acts, and a reassessment of that income tax made after a determination of income tax (referred to as a "specified reassessment" in that paragraph)), the amount of tax assessed has been changed, or tax has been assessed, under paragraph (1) after the day on which one year elapses from each due date for payment under Article 320, the period from the day following the day on which that one year elapses until the day on which the tax notice relating to the tax deficiency prescribed in that paragraph was issued is to be deducted from the period prescribed in the preceding paragraph.

In the case of paragraph (2), where a person liable for income tax has submitted an amended return, or a national tax office has made a reassessment of income tax (limited to one that increases the amount of tax to be paid, and including a reassessment specified by Cabinet Order as similar thereto; hereinafter in this paragraph referred to as a "reassessment increasing the tax") (limited to the case where the amount of tax assessed has increased after it was reduced under paragraph (1) as a result of a national tax office having made a reassessment of income tax (limited to one that reduces the amount of tax to be paid, and including a reassessment specified by Cabinet Order as similar thereto; hereinafter in this paragraph referred to as a "reassessment reducing the tax")), the periods set forth in the following items (limited to the period set forth in item (i), in the case of a tax deficiency changed as a result of the submission of a specified amended return or a specified reassessment, or other municipal inhabitant tax specified by Cabinet Order) are to be deducted from the period forming the basis for calculating the delinquency charge, with respect to the tax deficiency to be additionally collected (limited to the amount of tax specified by Cabinet Order as the part up to the amount obtained by deducting, from the amount of tax assessed before that reassessment reducing the tax, the amount of tax changed as a result of that reassessment reducing the tax (including the amount of tax equivalent to the amount of a refund); the same applies hereinafter in this paragraph).

the period from the day following each due date for payment under Article 320 until the day on which the tax notice relating to the amount of tax changed as a result of that reassessment reducing the tax was issued;

the period from the day following the day on which the tax notice relating to the amount of tax changed as a result of that reassessment reducing the tax was issued (or, if that reassessment reducing the tax is based on a request for reassessment, the day on which one year elapses counting from the day following that day) until the day on which the tax notice relating to the amount of tax changed as a result of the reassessment increasing the tax was issued.

If the mayor of the municipality finds that there are unavoidable reasons for the taxpayer having had the tax deficiency additionally collected under paragraph (1), the mayor may reduce or exempt the amount of delinquency charge under paragraph (2).

Where a person liable for tax is a person who received salary in the previous year and who, as of the first day of the fiscal year, is receiving salary (excluding a person found to be extremely difficult to collect from by the method of special collection because, for example, the person receives only salary for which the pay period is set at a period exceeding one month, or for another similar reason; hereinafter in this Article and the following Article referred to as a "salary earner"), a municipality is to collect, by the method of special collection, the total of the income levy amount and the per capita levy amount relating to the salary income of that person liable for tax for the previous year, out of the individual municipal inhabitant tax imposed on that person liable for tax. However, a municipality in which it is found inappropriate to carry out special collection due to special circumstances, such as there being few salary earners within the municipality, need not use the method of special collection.

Where, with respect to the salary earner referred to in the preceding paragraph, the income of that salary earner for the previous year includes income other than salary income, a municipality may, as provided by Municipal Ordinance of the municipality, add the income levy amount relating to that income other than salary income to the total of the income levy amount and the per capita levy amount relating to salary income that is to be collected by the method of special collection under the main clause of that paragraph, and collect it by the method of special collection. However, this does not apply where the return referred to in Article 317-2, paragraph (1) contains a statement to the effect that the income levy amount relating to income other than salary income is desired to be collected by the method of ordinary collection.

Where, after the income levy amount relating to income other than salary income of a salary earner has come to be collected by the method of special collection under the main clause of the preceding paragraph, a special circumstance has arisen that makes it found inappropriate to collect all or part of the income levy amount relating to income other than salary income of that salary earner by the method of special collection, that salary earner has made a request that all or part of the income levy amount relating to income other than salary income be collected by the method of ordinary collection, and the circumstance is found to be unavoidable, the municipality is to collect by the method of ordinary collection all or part of the portion of the income levy amount relating to income other than salary income that was to be collected by the method of special collection and has not yet been collected by special collection.

With regard to the application of the preceding two paragraphs where the salary earner referred to in paragraph (1) is a person who received public pension, etc. in the previous year and who, as of the first day of the fiscal year, is a person aged 65 or more who is receiving the old age, etc. pension benefit prescribed in Article 321-7-2, paragraph (1), the phrase "other than salary income" in those provisions is deemed to be replaced with "other than salary income and income relating to public pension, etc.".