Act on Special Measures Concerning Taxation

With regard to gift tax for a year on property that a person electing settlement taxation at inheritance prescribed in Article 21-9, paragraph (5) of the Inheritance Tax Act (referred to as a "person electing settlement taxation at inheritance" in paragraph (3)) has acquired during that year, on or after January 1, 2024, by gift from the specified donor prescribed in paragraph (5) of that Article (referred to as the "specified donor" in paragraph (3)), notwithstanding the provisions of Article 21-11-2, paragraph (1) of that Act, 1,100,000 yen is deducted from the taxable value for gift tax.

The amount deducted pursuant to the provisions of the preceding paragraph is deemed to have been deducted pursuant to the provisions of Article 21-11-2, paragraph (1) of the Inheritance Tax Act with regard to the application of the provisions of the Inheritance Tax Act and other laws and regulations concerning inheritance tax or gift tax.

The calculation of the amount to be deducted from the taxable value pertaining to property acquired by gift from each specified donor in the case where there are two or more specified donors pertaining to the person electing settlement taxation at inheritance referred to in paragraph (1) is specified by Cabinet Order.

In the case where land or a building acquired by a person electing settlement taxation at inheritance prescribed in Article 21-9, paragraph (5) of the Inheritance Tax Act (referred to as a "person electing settlement taxation at inheritance" in paragraph (3)) by gift from the specified donor prescribed in paragraph (5) of that Article has suffered damage of the degree specified by Cabinet Order as considerable damage due to a disaster (meaning an earthquake, storm and flood damage, fire or any other disaster specified by Cabinet Order; the same applies hereinafter in this paragraph) during the period from the day on which the gift was received until the filing deadline for the return filed by the due date under the provisions of Article 27, paragraph (1) of that Act pertaining to the death of that specified donor (limited to the case where that person electing settlement taxation at inheritance (including an heir prescribed in Article 21-17, paragraph (1) of that Act of that person electing settlement taxation at inheritance who has succeeded to the rights or obligations of that person electing settlement taxation at inheritance pursuant to the provisions of Article 21-17 or Article 21-18 of that Act; the same applies in paragraph (3)) has continuously owned that land or building from the day on which the gift was received until the day on which that disaster occurred), with regard to the application of the provisions of Article 21-15 and Article 21-16 of that Act when that person electing settlement taxation at inheritance has obtained the approval of the district director with jurisdiction over the place for tax payment for gift tax pursuant to the provisions of Cabinet Order, the phrase "from the value" in Article 21-15, paragraph (1) of that Act is deemed to be replaced with "from the value (for land or a building, out of that property, that has suffered damage due to a disaster prescribed in Article 70-3-3, paragraph (1) of the Act on Special Measures Concerning Taxation (Special Provisions on Value of Land or Buildings Pertaining to Settlement Taxation at Inheritance), the amount obtained by deducting from that value the amount calculated pursuant to the provisions of Cabinet Order as corresponding to the damaged part)", and the term "value" in Article 21-16, paragraph (3), item (ii) of that Act is deemed to be replaced with "value (for land or a building, out of that property, that has suffered damage due to a disaster prescribed in Article 70-3-3, paragraph (1) of the Act on Special Measures Concerning Taxation (Special Provisions on Value of Land or Buildings Pertaining to Settlement Taxation at Inheritance), the amount obtained by deducting from that value the amount calculated pursuant to the provisions of Cabinet Order as corresponding to the damaged part)".

With regard to the application of the provisions of Article 49 of the Inheritance Tax Act in the case where the provisions of the preceding paragraph apply, the phrase "taxable value for gift tax" in paragraph (1), item (ii) of that Article is deemed to be replaced with "taxable value for gift tax (for land or a building that has suffered damage due to a disaster prescribed in Article 70-3-3, paragraph (1) of the Act on Special Measures Concerning Taxation (Special Provisions on Value of Land or Buildings Pertaining to Settlement Taxation at Inheritance), the balance prescribed in Article 21-15, paragraph (1) or Article 21-16, paragraph (3), item (ii) as applied with the replacement of terms pursuant to the provisions of that paragraph)".

The provisions of the preceding two paragraphs do not apply in the case where a person electing settlement taxation at inheritance seeks or has received the application of the provisions of Article 4 or Article 6, paragraph (2) of the Act on Reduction or Release, Deferment of Collection and Other Measures Related to Tax Imposed on Disaster Victims (Act No. 175 of 1947) with regard to the land or building referred to in paragraph (1).

Beyond what is provided for in the preceding paragraph, necessary matters concerning the application of the provisions of paragraphs (1) and (2) are specified by Cabinet Order.