Act on Special Measures Concerning Taxation

In the case where an heir, etc. of specified planned forest has continued to hold all of the specified planned forest that the heir, etc. of specified planned forest acquired by inheritance or bequest (including a gift relating to property acquired by gift (excluding a gift that takes effect upon the death of the donor; the same applies hereinafter through Article 70-7-9) from the decedent relating to that inheritance which is subject to the provisions of Article 21-9, paragraph (3) of the Inheritance Tax Act (including as applied mutatis mutandis pursuant to Article 70-2-6, paragraph (1), Article 70-2-7, paragraph (1) (including as applied mutatis mutandis pursuant to Article 70-2-8) or Article 70-3, paragraph (1); the same applies in item (ii) of the following paragraph); the same applies hereinafter in this paragraph) and has selected, pursuant to the provisions of Cabinet Order, as that to which the provisions of this paragraph are to apply (referred to as "selected specified planned forest" in this paragraph and the following paragraph), from the time of the commencement of the succession until the due date for filing the return under Article 27, Article 29 or Article 31, paragraph (2) of that Act relating to the inheritance or bequest (or, in the case where the heir, etc. of specified planned forest dies before that due date, the date of death; referred to as the "return due date" in the following paragraph), or in any other case specified by Cabinet Order as equivalent thereto, the value to be included in the taxable value for inheritance tax prescribed in Article 11-2 of that Act (or, in the case where the provisions of Article 21-15, paragraph (1) of that Act apply, the taxable value for inheritance tax under the provisions of that paragraph) is the amount calculated by multiplying the value of the selected specified planned forest (or, in the case where the selected specified planned forest has been acquired by a gift subject to the provisions of Article 21-9, paragraph (3) of that Act, the balance remaining after deducting from that value the amount of the deduction under the provisions of Article 21-11-2, paragraph (1) of that Act (including the provisions of Article 70-3-2, paragraph (1))) by 95 percent.

In this Article, the meanings of the terms listed in the following items are as prescribed respectively in those items:

specified forest under a forest management plan: standing trees or land, etc. (meaning land or rights existing on land; the same applies hereinafter in this Article) that the decedent held immediately before the commencement of the succession relating to the decedent, which are located within an area for which a forest management plan prescribed in Article 11, paragraph (1) of the Forest Act (excluding a plan specified by Order of the Ministry of Finance as being for implementing forest operations by public-interest function prescribed in paragraph (5), item (ii), (b) of that Article and a plan whose certification has been revoked under the provisions of Article 16 of that Act or Article 9, paragraph (4) of the Act on Special Measures concerning Assurance of Stable Supply of Timber; referred to as a "forest management plan" in this paragraph) is established that received, before the commencement of the succession, the certification of the mayor of the municipality (or, in the case where the provisions of Article 19 of that Act apply, of the person specified in the relevant item of paragraph (1) of that Article according to the category of cases listed in those items) under the provisions of Article 11, paragraph (5) of the Forest Act (including as applied mutatis mutandis with replacement of terms pursuant to Article 12, paragraph (3) of that Act, as applied with replacement of terms pursuant to the provisions of Article 8 of the Act on Special Measures concerning Assurance of Stable Supply of Timber, and as applied mutatis mutandis with replacement of terms pursuant to Article 12, paragraph (3) of the Forest Act as applied with replacement of terms under Article 9, paragraph (2) or (3) of that Act) (referred to as "certification by the mayor of the municipality, etc." in this paragraph) (excluding those located within a district relating to the development of forest health facilities prescribed in Article 2, paragraph (2), item (ii) of the Act on Special Measures concerning Improvement of Public Health Function of Forests, and limited to those specified by Order of the Ministry of Finance as those for which forest operations are to be carried out efficiently as a single unit; the same applies in the following item);

specified donated forest under a forest management plan: standing trees or land, etc. that the specified donor who is the decedent (meaning a specified donor prescribed in Article 21-9, paragraph (5) of the Inheritance Tax Act; the same applies hereinafter in this Article) has given by gift (limited to a gift relating to property subject to the provisions of Article 21-9, paragraph (3) of that Act; the same applies hereinafter in this Article), which are located within an area for which a forest management plan that received certification by the mayor of the municipality, etc. before the gift is established;

heir, etc. of specified planned forest: a person listed in (a) or (b) below;

an individual who has acquired specified forest under a forest management plan by inheritance or bequest and who satisfies the requirements listed in (1) and (2);

being a person who has acquired specified forest under a forest management plan by the inheritance or bequest from the decedent relating to that inheritance or bequest and who is a relative of the decedent;

having continuously carried out forest operations, from the time of the commencement of the succession until the return due date, on the specified forest under a forest management plan that is selected specified planned forest, based on a forest management plan that has received certification by the mayor of the municipality, etc.;

an individual who has acquired specified donated forest under a forest management plan by gift and who satisfies the requirements listed in (1) and (2);

being a person subject to settlement taxation at the time of inheritance as prescribed in Article 21-9, paragraph (5) of the Inheritance Tax Act with regard to the specified donated forest under a forest management plan;

having continuously carried out forest operations, from the time of the gift relating to the specified donated forest under a forest management plan until the return due date relating to the inheritance that commenced upon the death of the specified donor who is the decedent, on the specified donated forest under a forest management plan that is selected specified planned forest, based on a forest management plan that has received certification by the mayor of the municipality, etc.

specified planned forest: standing trees or land, etc. listed in (a) or (b) below.

specified forest under a forest management plan located within an area for which a forest management plan relating to the certification by the mayor of the municipality, etc. that the decedent had received before the commencement of the succession relating to the decedent (limited to certification relating to specified forest under a forest management plan that is deemed to remain in effect pursuant to the provisions of Article 17, paragraph (1) of the Forest Act at the time the return due date passes; the same applies in (b)), or any other plan specified by Cabinet Order as equivalent thereto, is established (excluding forest located within a district relating to the development of forest health facilities prescribed in Article 2, paragraph (2), item (ii) of the Act on Special Measures concerning Improvement of Public Health Function of Forests, and limited to forest specified by Order of the Ministry of Finance as forest for which forest operations are to be carried out efficiently as a single unit);

specified donated forest under a forest management plan located within an area for which a forest management plan relating to the certification by the mayor of the municipality, etc. that the specified donor who is the decedent had received before the gift, or any other plan specified by Cabinet Order as equivalent thereto, is established (excluding forest located within a district relating to the development of forest health facilities prescribed in Article 2, paragraph (2), item (ii) of the Act on Special Measures concerning Improvement of Public Health Function of Forests, and limited to forest specified by Order of the Ministry of Finance as forest for which forest operations are to be carried out efficiently as a single unit).

The provisions of paragraph (1) do not apply to specified planned forest that has not been divided by the co-heirs or universal legatees by the due date for filing the return under Article 27 of the Inheritance Tax Act relating to the inheritance or bequest referred to in that paragraph (referred to as the "return due date" in this paragraph); provided, however, that this does not apply to the divided specified planned forest in the case where the undivided specified planned forest is divided within three years from the return due date (or, in the case where there are unavoidable circumstances specified by Cabinet Order, such as the filing of an action concerning the inheritance or bequest, for the specified planned forest not having been divided before the expiration of that period, and the approval of the district director with jurisdiction over the place for tax payment has been obtained pursuant to the provisions of Cabinet Order, within four months from the day following the day specified by Cabinet Order as the day on which the division of the specified planned forest became possible).

The provisions of paragraph (1) do not apply in the case where a person who has acquired property by the inheritance or bequest referred to in that paragraph from the decedent relating to the inheritance referred to in that paragraph is to be, or is, subject to the provisions of paragraph (1) of the preceding Article.

In the case where the area of the selected residential land, etc. (meaning the total of the areas calculated pursuant to the provisions of paragraph (2), item (iii), (a) through (c) of the preceding Article for the area of the residential land, etc. selected as small-scale residential land, etc. prescribed in paragraph (1) of that Article pursuant to the provisions of that Article; the same applies in item (ii)) is less than 200 square meters, if a person who has acquired property by the inheritance or bequest referred to in paragraph (1) selects specified forest under a forest management plan (including specified donated forest under a forest management plan; the same applies in item (i)) as selected specified planned forest prescribed in that paragraph, the person may, notwithstanding the provisions of the preceding paragraph, receive the application of the provisions of paragraph (1) for the portion up to the value obtained by multiplying the amount listed in item (i) by the ratio listed in item (ii):

the value of the specified forest under a forest management plan;

the ratio that the area obtained by deducting the area of the selected residential land, etc. from 200 square meters bears to 200 square meters.

The provisions of Article 32, paragraph (1) of the Inheritance Tax Act apply mutatis mutandis to the case referred to in the proviso to paragraph (3) and other cases specified by Cabinet Order as cases where the provisions of paragraph (1) have not been applied to the specified planned forest that has already been divided. In this case, the necessary technical replacement of terms is specified by Cabinet Order.

The provisions of paragraph (1) apply only if a person seeking the application of the provisions of that paragraph states in the return under Article 27 or Article 29 of the Inheritance Tax Act relating to the inheritance or bequest (including a tax return form filed after the due date relating to those returns and an amended return form relating to those returns; referred to as an "inheritance tax return" in paragraphs (10) and (11)) that the person seeks the application of the provisions of paragraph (1), and attaches to it a written statement concerning the calculation under the provisions of that paragraph and other documents specified by Order of the Ministry of Finance.

An heir, etc. of specified planned forest who seeks the application of the provisions of paragraph (1) with regard to specified donated forest under a forest management plan acquired by gift from a specified donor must, pursuant to the provisions of Cabinet Order, submit to the district director with jurisdiction over the place for tax payment, within the period referred to in Article 28, paragraph (1) of the Inheritance Tax Act, a document stating that the provisions of paragraph (1) are to be applied and other matters specified by Order of the Ministry of Finance, and other documents specified by Order of the Ministry of Finance.

In the case referred to in the preceding paragraph, if the document referred to in that paragraph relating to the specified donated forest under a forest management plan referred to in that paragraph has not been submitted to the district director with jurisdiction over the place for tax payment within the period referred to in that paragraph, the application of the provisions of paragraph (1) may not be received with regard to that specified donated forest under a forest management plan.

Notwithstanding the provisions of paragraph (7), the provisions of paragraph (1) do not apply in the case where, within two months from the due date for filing the inheritance tax return of the person seeking the application of the provisions of paragraph (1) with regard to specified forest under a forest management plan or specified donated forest under a forest management plan, there is no submission of the documents specified by Order of the Ministry of Finance certifying that forest operations have been carried out based on the forest management plan prescribed in paragraph (2), item (iii), (a), (2) or (b), (2) and other matters.

Even in the case where an inheritance tax return or the documents specified by Order of the Ministry of Finance referred to in the preceding paragraph have not been submitted, or where an inheritance tax return without the statement or attachment referred to in paragraph (7) has been submitted, if the district director finds that there were unavoidable circumstances for the failure to submit, or to make the statement or attachment, the district director may apply the provisions of paragraph (1), but only in the case where there has been a submission of a document containing that statement and of the documents specified by Order of the Ministry of Finance referred to in that paragraph and the preceding paragraph.

With regard to the application of the provisions of Article 41, paragraph (2) of the Inheritance Tax Act as applied mutatis mutandis pursuant to Article 48-2, paragraph (6) of that Act in the case where the provisions of paragraph (1) are applied to selected specified planned forest prescribed in that paragraph, the phrase "excluding property" in that paragraph is deemed to be replaced with "excluding property and selected specified planned forest prescribed in Article 69-5, paragraph (1) of the Act on Special Measures Concerning Taxation (Special Provisions on Calculation of Taxable Value for Inheritance Tax on Specified Planned Forest) to which the provisions of that paragraph have been applied".

Beyond what is provided for in paragraph (3) through the preceding paragraph, necessary matters concerning the application of paragraph (1) are specified by Cabinet Order.