During the May Day holiday just past, tourists from China were almost all over Japan, and the Chinese people who took advantage of the depreciation of the yen to rush to buy luxury goods crowded major shopping malls and duty-free shops, and their purchasing power shocked the Japanese.
According to the Japan Tourism Agency, the number of foreign tourists visiting Japan exceeded 3 million for the first time in March, and the spending of foreign visitors to Japan in January ~ March reached 1.7505 trillion yen, setting a quarterly high.
Among them, the total consumption of mainland tourists reached 352.6 billion yen, ranking first among all countries and regions, and 1.5 times that of South Korea, which ranked second!
However, many of these foreigners who went to Japan to buy goods took the opportunity to "fish in troubled waters" and used the tax-free system to illegally resell.
According to Japanese media reports, due to the sharp increase in the number of tourists visiting Japan, the Japanese government is considering re-examining the system of exempting tourists from consumption tax due to the emergence of illegal reselling of duty-free goods to make profits.
The company plans to introduce a refund system that allows customers to pay consumption tax normally when purchasing goods and refund the consumption tax when they leave the country, and is expected to be included in the tax system revision bill in fiscal 2025.
Under Japan's current tax-free system, visitors to Japan are exempt from consumption tax as a principle after purchasing goods at duty-free shops, and their purchase data is recorded electronically in their passports, and they are required to present their passports at customs when leaving the country to ensure that the purchases have been taken out of Japan.
In 2022, 374 people spent more than 100 million yen duty-free in Japan, and most of them did not take their goods out of the country, which the government believes is mainly for resale to make the difference.
Therefore, the Japanese government plans to change to a post-payment scheme that refunds taxes when leaving the country, and to prevent unfair practices by considering payment by credit card and electronic payment used in various countries in addition to cash.
The government will propose a revised tax system for FY2024, which will be decided by the Cabinet at the end of May, and it is expected to be approved and implemented in FY2025.
Duty-free reselling can also cause trouble for merchants, and it is reported that the Japan Tax Bureau has imposed an additional consumption tax of about 14 billion yen on Apple Japan in two years. Many tourists have been spotted buying iPhones tax-free in large quantities, and there have even been cases where one person has purchased hundreds of them.
The second-hand store Daikokuya was also taxed by the Tokyo National Tax Bureau for about 230 million yen for its tax-free sales to foreign customers for the purpose of resale.
In order to prevent the resale of duty-free goods, about 200 home appliance retailers, including "ビックカメラ", "コジマ", and "ソフマップ", have indicated that a new system will be introduced at the cash registers of all stores to provide an alert function for suspected resale.
When a purchaser checks out tax-free at the checkout counter, the passport number is shared across the store, preventing multiple purchases of the same passport in multiple stores.
In the event of a suspicious checkout, a warning will be issued to the store staff and the store may refuse to sell to the customer. The company plans to start with five high-priced products that are popular as duty-free products, and then expand the scope of the product in turn.
What do you think about the revision of Japan's tax-free system?