Local Tax Act

With regard to local consumption tax, the meaning of the terms listed in the following items is as specified in each item.

business operator: an individual business operator (meaning an individual who conducts business; the same applies in paragraph (2) of the following Article) and a corporation;

transfer levy: the local consumption tax imposed with the amount of consumption tax listed in Article 45, paragraph (1), item (iv) of the Consumption Tax Act as the tax base;

cargo levy: the local consumption tax imposed with the amount of consumption tax on the tax base amount listed in Article 47, paragraph (1), item (ii) of the Consumption Tax Act, or the amount of consumption tax to be collected pursuant to Article 50, paragraph (2) of that Act (excluding the amount of delinquent tax relating to consumption tax), as the tax base.

Local consumption tax is imposed, with respect to taxable transfers, etc. of assets carried out by a business operator (meaning, among the taxable transfers, etc. of assets prescribed in Article 2, paragraph (1), item (ix) of the Consumption Tax Act, those other than specified transfers, etc. of assets (meaning the specified transfers, etc. of assets prescribed in item (viii)-2 of that paragraph; the same applies in Article 72-84, paragraph (1), item (ii) and paragraph (2)) and those on which consumption tax is not imposed or is exempted under the provisions of that Act or another Act or a treaty; the same applies hereinafter in this Section) and specified taxable purchases (meaning, among the specified taxable purchases prescribed in Article 5, paragraph (1) of that Act, those other than those on which consumption tax is not imposed or is exempted under the provisions of that Act or another Act or a treaty; the same applies hereinafter in this Section), on that business operator (excluding a business operator exempted from the obligation to pay consumption tax pursuant to the main clause of Article 9, paragraph (1) of the Consumption Tax Act (for a trustee of a trust subject to corporate taxation, etc. prescribed in Article 15, paragraph (1) of that Act, limited to a business operator exempted from the obligation to pay consumption tax in respect of all of the trustee business operator prescribed in paragraph (3) of that Article and the own-capacity business operator prescribed in paragraph (4) of that Article)) by the prefecture prescribed in the following paragraph by means of the transfer levy, and, with respect to taxable goods prescribed in Article 2, paragraph (1), item (xi) of the Consumption Tax Act (excluding those on which consumption tax is not imposed or is exempted under the provisions of that Act or another Act or a treaty), on the person who takes delivery of those taxable goods from the bonded area prescribed in item (ii) of that paragraph, by the prefecture in which that bonded area is located, by means of the cargo levy.

The prefecture that imposes the transfer levy is the prefecture in which the place specified in each of the following items is located, according to the category of business operator listed in that item.

an individual business operator who has a domicile in Japan (meaning the area where this Act is enforced; the same applies hereinafter in this paragraph): the place of that domicile;

an individual business operator who has no domicile but has a residence in Japan: the place of that residence;

an individual business operator who has neither a domicile nor a residence in Japan but has in Japan an office, place of business or other similar place relating to the business that the operator conducts (hereinafter in this item and item (vi) referred to as an "office or similar place"): the location of that office or similar place (where there are two or more such offices or similar places, the location of the principal one);

an individual business operator other than the individual business operators listed in the preceding three items: the place specified by Cabinet Order;

a corporation that has its head office or principal office in Japan (referred to in the following item as a "domestic corporation"): the location of that head office or principal office;

a corporation other than a domestic corporation that has an office or similar place in Japan: the location of that office or similar place (where there are two or more such offices or similar places, the location of the principal one);

a corporation other than the corporations listed in the preceding two items: the place specified by Cabinet Order.

The place specified in each item of the preceding paragraph (excluding items (iv) and (vii)) is the place as of the first day of the taxable period (meaning the taxable period prescribed in Article 19 of the Consumption Tax Act; the same applies hereinafter in this Section) relating to the calculation of the amount of consumption tax that is the tax base of the transfer levy under that paragraph.

An association or foundation that is not a corporation and has a designated representative or administrator (hereinafter referred to with respect to local consumption tax as an "association or foundation without juridical personality") is deemed to be a corporation, and the provisions of this Section (excluding Article 72-89-2) apply.

A business conducted by the national government or a local government as an operation relating to the general account, or a business conducted by the national government or a local government by establishing a special account, that is deemed under Article 60, paragraph (1) of the Consumption Tax Act to be a business conducted by a single corporation, is deemed to be a business conducted by a single corporation for each such general account or special account, and the provisions of this Section apply.

Where the director-general of a customs house collects consumption tax pursuant to Article 8, paragraph (1) of the Act on Collection, etc. of National Consumption Tax Imposed on Imported Goods (Act No. 37 of 1955), or where a district director or the director-general of a customs house collects consumption tax pursuant to another provision of an Act concerning consumption tax that is specified by Cabinet Order, the prefecture in which the tax office to which that district director belongs or the customs house to which that director-general of a customs house belongs is located is to impose local consumption tax on the person liable to pay that consumption tax, with the amount of consumption tax to be collected as the tax base, and the provisions of this Section (excluding paragraphs (1) through (3) and this paragraph) apply on the basis that the local consumption tax to be imposed where a district director collects consumption tax is included in the transfer levy, and the local consumption tax to be imposed where the director-general of a customs house collects consumption tax is included in the cargo levy. In this case, the local consumption tax deemed to be included in the transfer levy is to be collected by the method of ordinary collection.

Where, pursuant to Article 5, paragraph (1) of the Act on Collection, etc. of National Consumption Tax Imposed on Imported Goods, delivery of foreign goods from a bonded area is deemed to be made, or where, pursuant to another provision of an Act concerning consumption tax that is specified by Cabinet Order, the provisions of the Consumption Tax Act are applied by deeming delivery of foreign goods from a bonded area to be made, the provisions of this Section apply by deeming the delivery of those foreign goods to be the delivery of taxable goods prescribed in paragraph (1). In this case, the phrase "the prefecture in which that bonded area is located" in that paragraph is deemed to be replaced with "the prefecture in which is located the customs house to which belongs the director-general of a customs house relating to consumption tax imposed under the provisions of the Consumption Tax Act applied pursuant to the provisions of Article 5, paragraph (1) of the Act on Collection, etc. of National Consumption Tax Imposed on Imported Goods and other provisions of Acts specified by Cabinet Order prescribed in paragraph (7)".

Necessary technical replacement of terms and other necessary matters concerning the application of the provisions of this Section under the preceding two paragraphs are specified by Cabinet Order.

Where the person who is considered, in law, to have carried out a taxable transfer, etc. of assets is a mere nominal holder and does not enjoy the consideration for that taxable transfer, etc. of assets, and a person other than that person enjoys the consideration for that taxable transfer, etc. of assets, the provisions of this Section apply on the basis that that taxable transfer, etc. of assets was carried out by the person who enjoys that consideration.

If a person who is deemed legally to have made a specified taxable purchase is a mere nominal holder, does not pay the consideration for that specified taxable purchase, and a person other than that person is the person who is to pay the consideration for that specified taxable purchase, the provisions of this Section apply as though that specified taxable purchase had been made by the person who is to pay that consideration.

A beneficiary of a trust (limited to a person who currently holds rights as a beneficiary) is deemed to hold the assets belonging to the trust property of that trust, and the provisions of this Section apply with the transfers, etc. of taxable assets and specified taxable purchases relating to the assets belonging to that trust property deemed to be the transfers, etc. of taxable assets and specified taxable purchases of that beneficiary; provided, however, that this does not apply to assets belonging to the trust property of a collective investment trust (meaning a collective investment trust prescribed in Article 2, item (xxix) of the Corporation Tax Act), a trust subject to corporate taxation (meaning a trust subject to corporate taxation prescribed in item (xxix)-2 of that Article; the same applies in paragraph (1) of the following Article), a retirement pension trust, etc. (meaning a retirement pension trust, etc. prescribed in Article 12, paragraph (4), item (i) of that Act), a public interest trust (meaning a public interest trust prescribed in item (ii) of that paragraph; the same applies in paragraph (1) of the following Article) or a participant protection trust (meaning a participant protection trust prescribed in that item), or to the transfers, etc. of taxable assets and specified taxable purchases relating to assets belonging to that trust property.

A person who actually has the authority to make changes to a trust (other than what Cabinet Order prescribes as the authority to make minor changes) and who is meant to benefit from the trust property (other than a beneficiary) is deemed to be a beneficiary as prescribed in the preceding paragraph, and the provisions of that paragraph apply.

The application of paragraph (1) in the case where there are two or more beneficiaries, the determination of whether a person falls under a person who is meant to benefit from the trust property as prescribed in the preceding paragraph, and other matters necessary for the application of the provisions of the preceding two paragraphs are specified by Cabinet Order.

A trustee of a trust subject to corporate taxation or a public interest trust (hereinafter in this Article referred to as a "trust subject to corporate taxation, etc.") is deemed to be a separate person for each of the trust assets, etc. of each trust subject to corporate taxation, etc. (meaning assets belonging to the trust property and the transfers, etc. of taxable assets and specified taxable purchases relating to assets belonging to that trust property; the same applies hereinafter in this Article) and personal assets and other holdings (meaning assets, transfers, etc. of taxable assets and specified taxable purchases other than the trust assets, etc. of a trust subject to corporate taxation, etc.; the same applies in the following paragraph), and the provisions of this Section (excluding Articles 72-78 through the preceding Article, Article 72-85, Article 72-91, Article 72-92, Article 72-95, Articles 72-101 through 72-104 and Articles 72-109 through 72-111; the same applies hereinafter in this Article) apply accordingly.

In the case referred to in the preceding paragraph, the trust assets, etc. and personal assets and other holdings of each trust subject to corporate taxation, etc. belong to the respective separate persons deemed under that paragraph.

If an individual business operator is a trustee business operator (meaning, with respect to a trustee of a trust subject to corporate taxation, etc., that trustee in the case where the provisions of this Section are applied, under the preceding two paragraphs, to the person to whom the trust assets, etc. relating to that trust subject to corporate taxation, etc. belong; the same applies hereinafter in this paragraph), that trustee business operator is deemed to be a corporation, and the provisions of this Section apply.

If there are two or more trustees of one trust subject to corporate taxation, etc., the trust assets, etc. of each trustee relating to that trust subject to corporate taxation, etc. are deemed to be the trust assets, etc. of the trustee who presides over the trust affairs of that trust subject to corporate taxation, etc. (referred to as the "presiding trustee" in the following paragraph), and the provisions of this Section apply.

With respect to the local consumption tax relating to the trust assets, etc. deemed under the preceding paragraph to be the trust assets, etc. of the presiding trustee, trustees other than the presiding trustee bear joint and several liability for payment of that local consumption tax.

In addition to what is provided for in the preceding paragraphs, matters necessary for the application of the provisions of this Section to trustees of trusts subject to corporate taxation, etc. are specified by Cabinet Order.

If the supply of telecommunications services prescribed in Article 15-2, paragraph (1) of the Consumption Tax Act is carried out through a digital platform prescribed in that paragraph (hereinafter in the following Article referred to as a "digital platform"), and the consideration for it is received through a Type 1 platform operator prescribed in that paragraph, the provisions of this Section apply as though that Type 1 platform operator had carried out the supply of telecommunications services.

If the transfer of assets set forth in the items of Article 15-3, paragraph (1) of the Consumption Tax Act is carried out through a digital platform, and the consideration for it is received through a Type 2 platform operator prescribed in that paragraph, the provisions of this Section apply as though that Type 2 platform operator had carried out the transfer of assets.

The provisions of Articles 6 and 7 do not apply to the local consumption tax.