Local Tax Act

For prefectural inhabitant tax, the meanings of the terms listed in the following items are as provided respectively in those items.

Per capita levy: means prefectural inhabitant tax imposed in equal amounts;

Income levy: means prefectural inhabitant tax imposed on the basis of income;

Corporation tax levy: means the prefectural inhabitant tax prescribed below respectively according to the following classification of corporations:

A corporation that has its head office or its principal office or place of business in the area in which this Act is enforced (referred to as a "domestic corporation" in this paragraph and Article 53): prefectural inhabitant tax imposed with the corporation tax amount as the tax base;

A corporation that does not have its head office or its principal office or place of business in the area in which this Act is enforced (referred to as a "foreign corporation" in this Section): prefectural inhabitant tax imposed, for each of the following classifications of corporation tax amount, with that corporation tax amount as the tax base:

The corporation tax amount on the domestic source income listed in Article 141, item (i), (a) of the Corporation Tax Act;

The corporation tax amount on the domestic source income listed in Article 141, item (i), (b) of the Corporation Tax Act.

Interest levy: means prefectural inhabitant tax imposed on the amount of interest and similar income to be received;

Dividend levy: means prefectural inhabitant tax imposed on the amount of specified dividends and similar income to be received;

Share transfer income levy: means prefectural inhabitant tax imposed on the amount of capital gains from the transfer of specified shares, etc.;

Corporation tax amount: means the amount prescribed below respectively according to the following classification of corporations:

Domestic corporation: the corporation tax amount calculated under the provisions of the Corporation Tax Act and other laws and regulations concerning corporation tax (excluding the amount of corporation tax on the international minimum tax amount (meaning the international minimum tax amount prescribed in Article 82-3, paragraph (1) of that Act) for each covered fiscal year (meaning each covered fiscal year prescribed in Article 15-2 of the Corporation Tax Act; the same applies hereinafter in this item), the amount of corporation tax on the international minimum tax residual amount (meaning the international minimum tax residual amount prescribed in Article 82-11, paragraph (1) of that Act) for each covered fiscal year, and the amount of corporation tax on the domestic minimum tax amount (meaning the domestic minimum tax amount prescribed in Article 82-19, paragraph (1) of that Act) for each covered fiscal year), meaning that amount before the application of the provisions of Article 68 of the Corporation Tax Act (including where applied with terms replaced pursuant to Article 3-3, paragraph (5), Article 6, paragraph (3), Article 8-3, paragraph (5), Article 9-2, paragraph (4), Article 9-3-2, paragraph (7), Article 41-9, paragraph (4), Article 41-12, paragraph (4) and Article 41-12-2, paragraph (7) of the Act on Special Measures Concerning Taxation (Act No. 26 of 1957)), Article 69 (including where applied with terms replaced pursuant to Article 66-7, paragraph (1) and Article 66-9-3, paragraph (1) of the Act on Special Measures Concerning Taxation), Article 69-2 (including where applied with terms replaced pursuant to Article 9-3-2, paragraph (7), Article 9-6, paragraph (4), Article 9-6-2, paragraph (4), Article 9-6-3, paragraph (4) and Article 9-6-4, paragraph (4) of the Act on Special Measures Concerning Taxation) and Article 70 of the Corporation Tax Act, and Article 42-4, Article 42-4-2, Article 42-5, Article 42-10 (excluding paragraphs (1), (3), (4) and (7)), Article 42-11 (excluding paragraphs (1), (3) through (5) and (8)), Article 42-11-2 (excluding paragraphs (1), (3), (4) and (7)), Article 42-12 (excluding paragraphs (1), (3) through (5) and (8)), Article 42-12-2, Article 42-12-5, Article 42-12-6 (excluding paragraphs (1), (9) through (11) and (19)), Article 42-12-7 (excluding paragraphs (1), (5), (6), (8), (9) and (12)), Article 66-7 (excluding paragraphs (2), (6) and (10) through (13)) and Article 66-9-3 (excluding paragraphs (2), (5) and (9) through (12)) of the Act on Special Measures Concerning Taxation, and not including the amounts of delinquent tax, interest tax, penalty tax for understatement, penalty tax for failure to file and heavy penalty tax on corporation tax;

Foreign corporation: for each of the following categories of domestic source income, the corporation tax amount calculated under the provisions of the Corporation Tax Act and other laws and regulations concerning corporation tax (excluding the amount of corporation tax on the international minimum tax residual amount (meaning the international minimum tax residual amount prescribed in Article 145-2, paragraph (1) of the Corporation Tax Act) for each covered fiscal year and the amount of corporation tax on the domestic minimum tax amount (meaning the domestic minimum tax amount prescribed in Article 145-6, paragraph (1) of that Act) for each covered fiscal year), meaning that amount before the application of the provisions of Article 68 of the Corporation Tax Act (including where applied with terms replaced pursuant to Article 9-3-2, paragraph (7), Article 41-9, paragraph (4), Article 41-12, paragraph (4) and Article 41-12-2, paragraph (7) of the Act on Special Measures Concerning Taxation) as applied mutatis mutandis pursuant to Article 144 of the Corporation Tax Act (including where applied with terms replaced pursuant to Article 9-3-2, paragraph (7), Article 41-9, paragraph (4), Article 41-12, paragraph (4), Article 41-12-2, paragraph (7) and Article 41-22, paragraph (2) of the Act on Special Measures Concerning Taxation), Article 144-2 and Article 144-2-2 of the Corporation Tax Act (including where applied with terms replaced pursuant to Article 9-3-2, paragraph (7), Article 9-6, paragraph (4), Article 9-6-2, paragraph (4), Article 9-6-3, paragraph (4) and Article 9-6-4, paragraph (4) of the Act on Special Measures Concerning Taxation), and Article 42-4, Article 42-4-2, Article 42-5, Article 42-10 (excluding paragraphs (1), (3), (4) and (7)), Article 42-11 (excluding paragraphs (1), (3) through (5) and (8)), Article 42-11-2 (excluding paragraphs (1), (3), (4) and (7)), Article 42-12 (excluding paragraphs (1), (3) through (5) and (8)), Article 42-12-2, Article 42-12-5, Article 42-12-6 (excluding paragraphs (1), (9) through (11) and (19)) and Article 42-12-7 (excluding paragraphs (1), (5), (6), (8), (9) and (12)) of the Act on Special Measures Concerning Taxation, and not including the amounts of delinquent tax, interest tax, penalty tax for understatement, penalty tax for failure to file and heavy penalty tax on corporation tax:

The domestic source income listed in Article 141, item (i), (a) of the Corporation Tax Act;

The domestic source income listed in Article 141, item (i), (b) of the Corporation Tax Act.

Amount of stated capital, etc.: means the amount prescribed below respectively according to the following classification of corporations:

A corporation that files a return and pays under Article 53, paragraph (1) (excluding the corporations listed in (b) and (c)): the total of the amount of stated capital, etc. prescribed in Article 2, item (xvi) of the Corporation Tax Act as of the last day of the computation period for the tax base of the corporation tax amount prescribed in that paragraph, and the amount obtained by deducting, from the total of the amounts listed in (1) for each business year ending before the first day of that computation period (referred to as "past business years" in (a) and (b)), the total of the amounts listed in (2) and (3) for past business years, adding the amount listed in (1) for that computation period, and subtracting from the result the amount listed in (3) for that computation period;

The amount that, on or after April 1, 2010, was made stated capital out of the surplus prescribed in Article 446 of the Companies Act (Act No. 86 of 2005) (excluding that recorded as surplus by reducing the amount of stated capital or the amount of capital reserves pursuant to Article 447 or Article 448 of that Act, and limited to that specified by Order of the Ministry of Internal Affairs and Communications) pursuant to Article 450 of that Act, or out of all or part of the amount of the earned reserve pursuant to Article 448, paragraph (1), item (ii) of that Act;

The amounts applied, during the period from April 1, 2001 to April 30, 2006, to cover a capital deficit through a reduction of capital or contributions (excluding where money or other assets were delivered), and to cover, out of the capital reserves prescribed in Article 289, paragraphs (1) and (2) of the Commercial Code prior to its amendment by Article 64 of the Act on Arrangement of Relevant Acts Incidental to Enforcement of the Companies Act (Act No. 87 of 2005; referred to as the "Companies Act Arrangement Act" in (2)) (referred to as the "former Commercial Code" in (2)) (including where these provisions are applied mutatis mutandis pursuant to Article 46 of the Limited Liability Companies Act (Act No. 74 of 1938) prior to its repeal by Article 1 of the Companies Act Arrangement Act (referred to as the "former Limited Liability Companies Act" in (2))), the capital deficit prescribed in Article 289, paragraph (1) and paragraph (2), item (ii) of the former Commercial Code (including where these provisions are applied mutatis mutandis pursuant to Article 46 of the former Limited Liability Companies Act);

The amount of the surplus prescribed in Article 446 of the Companies Act (limited to that, among the surplus recorded by reducing the amount of stated capital or the amount of capital reserves pursuant to Article 447 or Article 448 of that Act, which is specified by Order of the Ministry of Internal Affairs and Communications) that, on or after May 1, 2006, was applied to cover a loss specified by Order of the Ministry of Internal Affairs and Communications pursuant to Article 452 of that Act.

Among the corporations that file a return and pay under Article 53, paragraph (1), those obligated to submit the return prescribed in Article 71, paragraph (1) of the Corporation Tax Act (excluding where Article 72, paragraph (1) of that Act applies) or Article 144-3, paragraph (1) of that Act (excluding where Article 144-4, paragraph (1) of that Act applies) (excluding the corporations listed in (c)), or a corporation that files a return and pays under Article 53, paragraph (2) (excluding the corporations listed in (c)): the total of the amount of stated capital, etc. prescribed in Article 2, item (xvi) of the Corporation Tax Act as of the date specified by Cabinet Order, and the amount obtained by deducting the total of the amounts listed in (a)(2) and (a)(3) for past business years from the total of the amounts listed in (a)(1) for past business years;

A mutual company prescribed in the Insurance Business Act (Act No. 105 of 1995): the amount calculated as the net assets amount, as provided by Cabinet Order.

Salary income: means the salary income prescribed in Article 28, paragraph (1) of the Income Tax Act;

Severance pay or other such compensation: this means severance pay or other such compensation prescribed in Article 30, paragraph (1) of the Income Tax Act (including lump-sum payments deemed to be severance pay or other such compensation under Article 31 of that Act and amounts deemed to be severance pay or other such compensation under Article 29-5 of the Act on Special Measures Concerning Taxation).

Spouse in the same household: this means a spouse of a person liable for prefectural inhabitant tax who shares a livelihood with that person (excluding one who falls under a relative employed only by a blue-return filer prescribed in Article 32, paragraph (3) and receives salary prescribed in that paragraph, and one who falls under a relative employed only in the business prescribed in paragraph (4) of that Article), whose total income in the year preceding the year that includes the first day of the fiscal year in question (hereinafter in this Article through Article 45-3 referred to as the "previous year") is 620,000 yen or less.

Claimable spouse: means, among spouses in the same household, the spouse of a person liable for prefectural inhabitant tax whose total income for the previous year is 10,000,000 yen or less;

Dependent: this means any of the relatives of a person liable for prefectural inhabitant tax (excluding that person's spouse), the children entrusted to foster parents prescribed in Article 6-4 of the Child Welfare Act (Act No. 164 of 1947) pursuant to Article 27, paragraph (1), item (iii) of that Act, and the elderly persons entrusted, pursuant to Article 11, paragraph (1), item (iii) of the Act on Social Welfare for the Elderly (Act No. 133 of 1963), to a foster caregiver prescribed in that item, who share a livelihood with that person (excluding one who falls under a relative employed only by a blue-return filer prescribed in Article 32, paragraph (3) and receives salary prescribed in that paragraph, and one who falls under a relative employed only in the business prescribed in paragraph (4) of that Article), and whose total income in the previous year is 620,000 yen or less.

Person with a Disability: a person that, at all times, lacks the ability to function on a rational basis due to a mental disability; a person who is blind; or any other person with a mental or physical disability for whom Cabinet Order provides;

Widow: a person as follows who does not fall under the category of a single parent:

a person who has not remarried following a divorce from the husband, and who satisfies the following requirements:

the person has a dependent;

the total income for the previous year is 5,000,000 yen or less;

there is no person specified by Order of the Ministry of Internal Affairs and Communications as a person found to be in circumstances equivalent to a de facto marital relationship with the person;

a person who has not remarried following the death of the husband, or a person whose husband's whereabouts are unknown and who is provided for by Cabinet Order, who satisfies the requirements set forth in (a)(2) and (3).

Single parent: a person who is not currently married, or a person whose spouse's whereabouts are unknown and who is provided for by Cabinet Order, who satisfies the following requirements:

the person has a child provided for by Cabinet Order whose living expenses are paid from the same resources as the person;

the total income for the previous year is 5,000,000 yen or less;

there is no person specified by Order of the Ministry of Internal Affairs and Communications as a person found to be in circumstances equivalent to a de facto marital relationship with the person.

Total income: means the total of the amount of gross income, the amount of retirement income and the amount of timber income under Article 32, paragraph (1), before the deductions under paragraphs (8) and (9) of that Article;

Interest and similar income: means interest, distributions of proceeds and any other similar income listed below;

General interest and similar income prescribed in Article 3, paragraph (1) of the Act on Special Measures Concerning Taxation that is to be received in the area in which this Act is enforced (including gains received under a worker asset-formation savings insurance contract, etc. that is deemed to be interest and similar income prescribed in Article 23, paragraph (1) of the Income Tax Act pursuant to Article 4-4, paragraph (1) of the Act on Special Measures Concerning Taxation; payments under Article 53, paragraph (1) of the Deposit Insurance Act (limited to the portion equivalent to the amount deemed, pursuant to Article 58-2, paragraph (1) of that Act, to be the interest listed in item (i) of that paragraph, the distribution of proceeds listed in item (iv) of that paragraph or the amount of interest listed in item (v) of that paragraph); consideration for purchase under Article 70, paragraph (1) of that Act (limited to the portion equivalent to the amount deemed, pursuant to Article 73, paragraph (1) of that Act, to be the interest listed in item (i) of that paragraph, the distribution of proceeds listed in item (iv) of that paragraph or the amount of interest listed in item (v) of that paragraph); and payments under the proviso to Article 70, paragraph (2) of that Act (limited to the portion equivalent to the amount deemed, pursuant to Article 73, paragraph (2) of that Act, to be the interest listed in paragraph (1), item (i) of that Article, the distribution of proceeds listed in item (iv) of that paragraph or the amount of interest listed in item (v) of that paragraph); payments under Article 55, paragraph (1) of the Agricultural and Fishery Cooperatives Savings Insurance Act (limited to the portion equivalent to the amount deemed, pursuant to Article 60-2, paragraph (1) of that Act, to be the interest listed in item (i) of that paragraph, the distribution of proceeds listed in item (iii) of that paragraph or the amount of interest listed in item (iv) of that paragraph); consideration for purchase under Article 70, paragraph (1) of that Act (limited to the portion equivalent to the amount deemed, pursuant to Article 73, paragraph (1) of that Act, to be the interest listed in item (i) of that paragraph, the distribution of proceeds listed in item (iii) of that paragraph or the amount of interest listed in item (iv) of that paragraph); and payments under the proviso to Article 70, paragraph (2) of that Act (limited to the portion equivalent to the amount deemed, pursuant to Article 73, paragraph (2) of that Act, to be the interest listed in paragraph (1), item (i) of that Article, the distribution of proceeds listed in item (iii) of that paragraph or the amount of interest listed in item (iv) of that paragraph); and payments of dormant deposit substitute funds prescribed in Article 7, paragraph (2) of the Act on Utilization of Funds from Dormant Deposits to Promote Privately-Run Public Interest Activities (Act No. 101 of 2016) (limited to the portion equivalent to the amount deemed, pursuant to Article 45, paragraph (1) of that Act, to be the interest listed in item (i) or (ii) of Article 4, paragraph (2) of that Act, the distribution of proceeds listed in item (v) of that paragraph or the amount of interest listed in item (vi) of that paragraph), but excluding interest or distributions of proceeds to which Article 10, paragraph (1) of the Income Tax Act applies, the interest, distributions of proceeds or gains listed in the items of Article 4-2, paragraph (1) of the Act on Special Measures Concerning Taxation concerning asset-formation housing savings to which that paragraph applies, and the interest, distributions of proceeds or gains listed in the items of Article 4-3, paragraph (1) of the Act on Special Measures Concerning Taxation concerning asset-formation pension savings to which that paragraph applies);

Interest and similar income on general foreign public and corporate bonds, etc. prescribed in Article 3-3, paragraph (1) of the Act on Special Measures Concerning Taxation that is received through a person handling payments in Japan prescribed in that paragraph (referred to as "interest and similar income on general foreign public and corporate bonds, etc." in Article 71-8);

Dividends and similar income relating to distributions of proceeds from privately placed bond-based investment trusts, etc. prescribed in Article 8-2, paragraph (1) of the Act on Special Measures Concerning Taxation (excluding those relating to distributions of proceeds to which Article 10, paragraph (1) of the Income Tax Act applies, distributions of proceeds listed in item (iii) of Article 4-2, paragraph (1) of the Act on Special Measures Concerning Taxation concerning asset-formation housing savings to which that paragraph applies, and distributions of proceeds listed in item (iii) of Article 4-3, paragraph (1) of the Act on Special Measures Concerning Taxation concerning asset-formation pension savings to which that paragraph applies);

Dividends and similar income on foreign privately placed bond-based investment trusts, etc. prescribed in Article 8-3, paragraph (1) of the Act on Special Measures Concerning Taxation that are received through a person handling payments in Japan prescribed in that paragraph (referred to as "dividends and similar income on foreign privately placed bond-based investment trusts, etc." in Article 71-8);

Prizes, etc. on prize-linked deposits and savings, etc. prescribed in Article 41-9, paragraph (1) of the Act on Special Measures Concerning Taxation;

Benefit supplements, interest, profits or gains listed in Article 174, items (iii) through (viii) of the Income Tax Act that are to be received in the area in which this Act is enforced (including payments under Article 53, paragraph (1) of the Deposit Insurance Act (limited to the portion equivalent to the amount deemed, pursuant to Article 58-2, paragraph (1) of that Act, to be the amount of benefit supplements listed in item (ii) or (iii) of that paragraph); consideration for purchase under Article 70, paragraph (1) of that Act (limited to the portion equivalent to the amount deemed, pursuant to Article 73, paragraph (1) of that Act, to be the amount of benefit supplements listed in item (ii) or (iii) of that paragraph); and payments under the proviso to Article 70, paragraph (2) of that Act (limited to the portion equivalent to the amount deemed, pursuant to Article 73, paragraph (2) of that Act, to be the amount of benefit supplements listed in item (ii) or (iii) of paragraph (1) of that Article); payments under Article 55, paragraph (1) of the Agricultural and Fishery Cooperatives Savings Insurance Act (limited to the portion equivalent to the amount deemed, pursuant to Article 60-2, paragraph (1) of that Act, to be the amount of benefit supplements listed in item (ii) of that paragraph); consideration for purchase under Article 70, paragraph (1) of that Act (limited to the portion equivalent to the amount deemed, pursuant to Article 73, paragraph (1) of that Act, to be the amount of benefit supplements listed in item (ii) of that paragraph); and payments under the proviso to Article 70, paragraph (2) of that Act (limited to the portion equivalent to the amount deemed, pursuant to Article 73, paragraph (2) of that Act, to be the amount of benefit supplements listed in paragraph (1), item (ii) of that Article); and payments of dormant deposit substitute funds prescribed in Article 7, paragraph (2) of the Act on Utilization of Funds from Dormant Deposits to Promote Privately-Run Public Interest Activities (limited to the portion equivalent to the amount deemed, pursuant to Article 45, paragraph (1) of that Act, to be the amount of benefit supplements listed in item (iii) or (iv) of Article 4, paragraph (2) of that Act)).

Specified dividends and similar income: means the following;

Dividends and similar income on listed shares, etc. prescribed in Article 8-4, paragraph (1) of the Act on Special Measures Concerning Taxation;

Dividends and similar income prescribed in Article 9-3 of the Act on Special Measures Concerning Taxation that are listed in item (i) of that Article (excluding those listed in (a) and those specified by Cabinet Order);

The gain amount prescribed in Article 41-12-2, paragraph (6), item (iii) of the Act on Special Measures Concerning Taxation relating to the redemption money listed in the items of Article 41-12-2, paragraph (1) of that Act.

Consideration, etc. for the transfer of specified shares, etc.: means the consideration for the transfer prescribed in Article 37-12-2, paragraph (2) of the Act on Special Measures Concerning Taxation of listed shares, etc. held in a specified account prescribed in Article 37-11-3, paragraph (1) of that Act relating to a withholding-option account prescribed in Article 37-11-4, paragraph (1) of that Act (hereinafter in this item and Subsection 6 referred to as a "withholding-option account"), or an amount equivalent to the gain from cash settlement prescribed in Article 37-11-4, paragraph (1) of that Act relating to margin transactions, etc. prescribed in Article 37-11-3, paragraph (2) of that Act of the listed shares, etc. prescribed in that paragraph processed in that withholding-option account;

Amount of capital gains from the transfer of specified shares, etc.: means the adjusted income amount within a withholding-option account prescribed in Article 37-11-4, paragraph (2) of the Act on Special Measures Concerning Taxation;

Permanent establishment: means the following; provided, however, that if a treaty concluded by Japan for the avoidance of double taxation or the prevention of tax evasion with respect to taxes provides otherwise than the following, with respect to a foreign corporation to which that treaty applies, it means what is provided for as a permanent establishment in that treaty (limited to that located in Japan (meaning the area in which this Act is enforced; the same applies hereinafter in this item));

A branch, factory or other fixed place where business is conducted, of a foreign corporation located in Japan, which is specified by Cabinet Order;

A place in Japan where a foreign corporation carries out construction or installation work or provides services of directing and supervising such work, or any other place specified by Cabinet Order as being equivalent thereto;

A person who has the authority to conclude contracts on behalf of a foreign corporation and whom the foreign corporation places in Japan, or any other equivalent person, who is specified by Cabinet Order.

If the spouse of a person liable for prefectural inhabitant tax falls under a spouse in the same household of that person liable for tax and also falls under a dependent of another person liable for prefectural inhabitant tax, that spouse is deemed, as provided by Cabinet Order, to fall under only one of these.

If the spouse of a person liable for prefectural inhabitant tax falls under the spouse whose living expenses are paid from the same resources as that person liable for tax, prescribed in Article 34, paragraph (1), item (x)-2, and also falls under a specified relative of another person liable for prefectural inhabitant tax (meaning a specified relative prescribed in item (xii) of Article 34, paragraph (1); the same applies in the following paragraph), that spouse is deemed, as provided by Cabinet Order, to fall under only one of these.

If there is a person who falls under a dependent or specified relative of two or more persons liable for prefectural inhabitant tax, that person is deemed, as provided by Cabinet Order, to fall under only a dependent or specified relative of any one of those persons liable for tax.

When laws and regulations relating to income tax, such as the Income Tax Act, are cited with regard to prefectural inhabitant tax (excluding where cited in paragraph (1), item (vi) and items (xiv) through (xvii), Article 25-2, Division 3 of the following Subsection, Subsections 4 through 6, and Article 35-2-5, paragraphs (2) through (4) of the Supplementary Provisions), those laws and regulations mean those as applied to the income of the previous year.