Local Tax Act

Enterprise tax on the business conducted by a corporation is imposed on the corporation, with regard to the business it conducts, in the prefecture where its office or place of business is located, by the amount specified in each of the following items according to the classification of business set forth in that item.

Businesses other than those listed in the following item through item (iv): the amount specified below according to the classification of corporations set forth below

Corporations other than those listed in (b): the sum of the value-added levy amount, the capital levy amount and the income levy amount;

Corporations listed in each item of Article 72-4, paragraph (1), corporations listed in each item of Article 72-5, paragraph (1), corporations listed in each item of Article 72-24-7, paragraph (7), associations or foundations without juridical personality prescribed in paragraph (4), deemed taxable corporations prescribed in paragraph (5), investment corporations (meaning investment corporations prescribed in Article 2, paragraph (12) of the Act on Investment Trusts and Investment Corporations; the same applies in Article 72-32, paragraph (2), item (iii)), specific purpose companies (meaning specific purpose companies prescribed in Article 2, paragraph (3) of the Act on the Securitization of Assets; the same applies in Article 72-32, paragraph (2), item (iv)), and general incorporated associations (excluding those falling under non-profit corporations (meaning non-profit corporations prescribed in Article 2, item (ix)-2 of the Corporation Tax Act; the same applies hereinafter in this item)) and general incorporated foundations (excluding those falling under non-profit corporations) (hereinafter in (b) referred to as "corporations taxed on income, etc."), and corporations other than corporations taxed on income, etc. whose amount of stated capital or amount of capital contributions is 100,000,000 yen or less or that have no capital or capital contributions (excluding those falling under the following corporations among the corporations other than corporations taxed on income, etc.): income levy amount

Among corporations that have, with a specified corporation (meaning a corporation whose amount of paid-in capital (meaning the amount specified by Cabinet Order as the amount invested in the corporation by its shareholders, or by members of a general partnership company, limited partnership company or limited liability company, or by other investors in the corporation; the same applies hereinafter in (1) and (2)) exceeds 5,000,000,000 yen (excluding corporations listed in (b)), and a mutual company prescribed in the Insurance Business Act (including those specified by Cabinet Order as equivalent thereto); the same applies hereinafter in (1) and (2)), a full controlling interest held by that specified corporation (meaning the full controlling interest prescribed in Article 2, item (xii)-7-6 of the Corporation Tax Act; the same applies hereinafter in this item and in item (ii) of the following paragraph), those whose amount of paid-in capital (where, on or after the date of promulgation of the Act Partially Amending the Local Tax Act, etc. (Act No. 4 of 2024), there is a full controlling interest (limited to one held by a specified corporation other than that corporation) between that corporation and the specified corporation, or in other cases specified by Cabinet Order, and that corporation has paid a dividend of surplus (limited to one accompanying a decrease in the amount specified by Cabinet Order out of the amount of paid-in capital; the same applies hereinafter in (1) and (2)) or made a refund of capital contributions, the amount obtained by adding the amount of paid-in capital decreased by that dividend of surplus or refund of capital contributions) exceeds 200,000,000 yen;

Among corporations in the case where, if all of the shares and capital contributions held by all the specified corporations that have a full controlling interest with the corporation are deemed to be held by any one of those specified corporations, there would be, between that one and the corporation, a full controlling interest held by that one, those whose amount of paid-in capital (where, on or after the date of promulgation of the Act Partially Amending the Local Tax Act, etc. (Act No. 4 of 2024), there is a full controlling interest held by a specified parent corporation (meaning, where in the relevant business year there is a full controlling interest held by another corporation between the corporation and that other corporation, that other corporation; the same applies hereinafter in (2)) between the specified parent corporation and the corporation and, if all of the shares and capital contributions held by all the specified corporations that have a full controlling interest with the corporation are deemed to be held by any one of those specified corporations, there would be, between that one and the corporation, a full controlling interest held by that one, or in other cases specified by Cabinet Order, and the corporation has paid a dividend of surplus or made a refund of capital contributions, the amount obtained by adding the amount of paid-in capital decreased by that dividend of surplus or refund of capital contributions) exceeds 200,000,000 yen (excluding the corporations listed in (1)).

Electricity supply business (excluding the business listed in the following item), among gas supply business, the general gas pipeline business prescribed in Article 2, paragraph (5) of the Gas Business Act (Act No. 51 of 1954) and the specified gas pipeline business prescribed in paragraph (7) of that Article (hereinafter in this Section referred to as "gas pipeline supply business"), insurance business, and trade insurance business: revenue levy amount;

Among electricity supply business, the retail electricity business prescribed in Article 2, paragraph (1), item (ii) of the Electricity Business Act (Act No. 170 of 1964) (including that specified by Order of the Ministry of Internal Affairs and Communications as equivalent thereto; hereinafter in this Section referred to as "retail electricity business, etc."), the power generation business prescribed in item (xiv) of that paragraph (including that specified by Order of the Ministry of Internal Affairs and Communications as equivalent thereto; hereinafter in this Section referred to as "power generation business, etc.") and the specified wholesale supply business prescribed in item (xv)-3 of that paragraph (hereinafter in this Section referred to as "specified wholesale supply business"): the amount specified below respectively according to the classification of corporations set forth below

Corporations other than those listed in (b): the sum of the revenue levy amount, the value-added levy amount and the capital levy amount;

Corporations listed in item (i), (b): the sum of the revenue levy amount and the income levy amount.

Among gas supply business, that conducted by a gas manufacturer prescribed in Article 2, paragraph (10) of the Gas Business Act (limited to a person that conducts gas manufacturing business (meaning gas manufacturing business prescribed in paragraph (9) of that Article) within the supply area under Article 38, paragraph (2), item (iv) of that Act relating to a special general gas pipeline operator prescribed in Article 54-2 of that Act) (excluding gas pipeline supply business; hereinafter in Article 72-24-2, paragraph (1) and Article 72-24-7, paragraph (4) referred to as "specified gas supply business"): the sum of the revenue levy amount, the value-added levy amount and the capital levy amount.

In applying the provisions of the preceding paragraph, the determinations listed in the following items are made according to the status as of the date specified in those items.

The determination of whether a corporation is one whose amount of stated capital or amount of capital contributions is 100,000,000 yen or less and whether it is a corporation that has no capital or capital contributions, and the determination of matters necessary for determining whether it falls under a corporation listed in item (i), (b), (1) or (2) of the preceding paragraph (excluding the determination listed in the following item): the last day of the relevant business year (for enterprise tax to be paid through filing and payment pursuant to the proviso to Article 72-26, paragraph (1), the day before the day on which six months have elapsed prescribed in that paragraph; for enterprise tax to be paid through filing and payment pursuant to Article 72-29, paragraph (1), (3) or (5), the date of its dissolution);

The determination of matters necessary for determining whether another corporation that has a full controlling interest with a corporation on the last day of the relevant business year prescribed in the preceding item is, in that business year, a specified corporation under item (i), (b), (1) or (2) of the preceding paragraph: the last day of the business year of that other corporation that last ended on or before that day (where there is no such day, the date of establishment of that other corporation).

Enterprise tax on the business conducted by an individual is imposed on the individual, with regard to type 1 business, type 2 business and type 3 business conducted by the individual, in the prefecture where the office or place of business is located, with income as the tax base.

An association or foundation that is not a corporation, that has a representative or administrator designated, and that conducts profit-making business or undertakes a trust subject to corporate taxation (meaning a trust subject to corporate taxation prescribed in Article 2, item (xxix)-2 of the Corporation Tax Act; the same applies hereinafter in this Section) (including such an association or foundation that has discontinued the profit-making business; hereinafter referred to as an "association or foundation without juridical personality" with regard to enterprise tax) is deemed to be a corporation, and the provisions of this Section (excluding Article 72-32) apply to it.

An individual who undertakes a trust subject to corporate taxation (hereinafter in this Section referred to as a "deemed taxable corporation") is, in addition to being subject to enterprise tax on the business conducted by an individual pursuant to the provisions of paragraph (3), deemed to be a corporation and subject to enterprise tax on the business conducted by a corporation.

In applying the provisions of this Section to the business conducted by a foreign corporation or by an individual who has no principal office or place of business in the area where this Act is in force, a permanent establishment is regarded as its office or place of business.

With regard to type 1 business, type 2 business and type 3 business conducted without establishing an office or place of business, enterprise tax is imposed by deeming, among the domicile or residence of the person who conducts the business, the one most closely related to that business to be its office or place of business.

The "type 1 business" referred to in paragraph (3) means any of the following:

goods sales business (including the business of selling animals, plants and other things not ordinarily called goods);

insurance business;

money lending business;

goods leasing business (including the business of leasing animals, plants and other things not ordinarily called goods);

real estate leasing business;

manufacturing business (including the business of processing and repairing goods);

electricity supply business;

earth and stone extraction business;

telecommunications business (including broadcasting business);

transportation business;

transportation handling business;

ship mooring facility business;

warehousing business (including the business of receiving goods on deposit and keeping them in custody);

parking lot business;

contracting business;

printing business;

publishing business;

photography business;

room rental business;

inn business;

restaurant business;

eating and drinking establishment business;

referral business;

agency business;

brokerage business;

commission agent business;

currency exchange business;

public bath business (excluding that listed in paragraph (10), item (xx));

theatrical performance business;

amusement facility business;

sightseeing facility business;

businesses equivalent to those listed in the preceding items that are specified by Cabinet Order.

The "type 2 business" referred to in paragraph (3) means any of the following, other than those specified by Cabinet Order as conducted mainly using one's own labor:

livestock farming (excluding that conducted incidentally to agriculture);

fisheries (excluding that specified by Cabinet Order as the business of catching aquatic animals and plants on a small scale);

businesses equivalent to those listed in the preceding two items that are specified by Cabinet Order (excluding agriculture).

The "type 3 business" referred to in paragraph (3) means any of the following:

medical business;

dental business;

pharmacist business;

anma massage, massage or shiatsu, acupuncture, moxibustion, judo-seifuku (judo therapy), and other businesses similar to medical business (excluding that conducted by a person who has lost the sight of both eyes or by any other person with a visual impairment specified by Cabinet Order as equivalent thereto);

veterinary business;

farrier business;

attorney business;

judicial scrivener business;

administrative scrivener business;

notary public business;

patent attorney business;

certified public tax accountant business;

certified public accountant business;

registered accountant business;

labor and social security attorney business;

consultant business;

design supervisor business;

real estate appraisal business;

design business;

business of teachers of various arts;

barber business;

beauty salon business;

laundry business;

public bath business (excluding public bath businesses specified by Cabinet Order);

businesses equivalent to those listed in the preceding items that are specified by Cabinet Order.

The scope of the profit-making businesses referred to in paragraph (4), and the scope of the businesses listed in item (xv)-3 of the preceding paragraph and the businesses listed in item (xvi)-3 of that paragraph, are specified by Cabinet Order.