April 17, 2019
To encourage SMEs and small enterprises to accelerate their preparation for addressing the reduced tax rates under the new consumption tax system that will start in October 2019, the Ministry of Economy, Trade and Industry (METI) has been implementing support measures for such SMEs’ activities and intensively making efforts to disseminate information on such measures. METI held an Ad-hoc Meeting bringing together board member-level representatives of major cash register manufacturers and system vendors.
1. Outline of the meeting
The new consumption tax system, i.e., the hike of the consumption tax rate (national and local taxes) and the implementation of reduced tax rates for certain products including foods and beverages will start on October 1, 2019. As the effective date is close at hand, METI and the Small and Medium Enterprise Agency (SMEA) have been expanding subsidy programs for encouraging SMEs and small enterprises across Japan to introduce new cash registers and develop their computer systems adapted to the new tax system (hereinafter referred to as “Subsidies for Cash Registers and Computer Systems”) and, through these programs, have also been requesting such SMEs across Japan to start preparations for addressing the reduced tax rates as early as possible.
Amid advancing these efforts, the number of applications filed for receiving the Subsidies for Cash Registers and Computer Systems reached the record high of 100,000 in April 2019. Furthermore, the number of telephone inquiries for subsidies to consultation counters increased in 2019 so far from the previous year, as seen by 7,000 in January, 8,000 in February, 10,000 in March and more than 10,000 expected in April, while the average inquiries in 2018 were between 3,000 and 4,000 per month. The number of future applications for subsidies is also expected to dramatically increase.
Against this backdrop, METI held an Ad-hoc Meeting on Measures to Encourage SMEs to Accelerate Preparations for Addressing the New Consumption Tax System, bringing together representatives of cash register manufacturers and system vendors engaging in efforts for upgrading and developing cash registers and computer systems so as to encourage SMEs and small enterprises to address the reduced tax rates. This meeting was held to request these manufacturers and vendors to: further make use of support measures; enhance and improve their systems for selling cash registers and other products or supporting SMEs; and promote their collaboration with SME associations. To this end, at the meeting, METI and SMEA requested these manufacturers and vendors to cooperate in the following efforts:
- Utilize the Subsidies for Cash Registers and Computer Systems in a more proactive manner;
- Enhance efforts for sales marketing and product sales targeting all regions across Japan;
- Provide full-fledged support to customers toward the period just before the start of the new tax system; and
- Provide cooperation to SME associations in explanatory meetings or workshops concerning the new tax systems held by such associations.
Division in Charge
- Policy Planning and Coordination Division & Corporate Finance and Tax Affairs Division, SMEA
- IT Industry Division, Commerce and Information Policy Bureau, METI