Announcement of METI’s Efforts Regarding Measures for Securing Smooth and Appropriate Transfer of Consumption Tax as of the End of March 2019
June 14, 2019
Following the rise in the consumption tax rate to 8% in April 2014, the Ministry of Economy, Trade and Industry (METI) has been conducting a variety of measures to ensure the smooth and appropriate transfer of the increased consumption tax. METI hereby announces the compiled results of the specific measures undertaken for that purpose as of the end of March 2019.
METI will continue to monitor and police consumption tax transfers to prevent parties from refusing to transfer the consumption tax and will strictly address violations of related regulations based on such regulations.
Outline of efforts
1. Efforts to monitor and police violations
- Following on from the FY2018 surveys, in FY2019, METI also has been conducting full-scale written surveys to collect information on the refusals of buyers to pay the additional tax to their sellers.
- As of the end of March 2019, METI and the Japan Fair Trade Commission (JFTC) had provided instruction to a total of 4,661 businesses, requested action from 13 businesses, and sent recommendations to 48 businesses (figures are for the total number of cases METI and the JFTC dealt with), concerning such refusals.
- Inspectors, whose role is to monitor buyers’ refusals to pay the additional tax, are patrolling certain areas and taking actions such as collecting information on such refusals and providing counseling.
2. Efforts to raise public awareness and provide consultation services
- METI has printed about 1.85 million copies of guides and manuals in total to help the public easily understand the measures in place to secure smooth and appropriate consumer tax transfers and has distributed them to businesses across Japan.
- As of the end of March 2019, about 24,000 seminars in total concerning such measures had been held at SME associations and government-approved support organizations, with about 540,000 people attending.
- METI held explanatory meetings to inform related industry associations and businesses about the guidelines for promoting fair subcontracting practices that were revised to include compliance for the smooth and appropriate transfer of consumption tax.
- Four SME associations have opened 2,324 consultation counters across Japan to provide the public with face-to-face consultation services. As of the end of March 2019, about 2 million cases in total had been handled
- The Small and Medium Enterprise Agency (SMEA) has been running an online consultation counter where they handle public petitions with full consideration for security. Please take advantage of this website for consultation services concerning tax transfers if necessary. Also please note that the SMEA is still providing telephone consultation services.
- METI instituted a monitoring survey for businesses concerning the current situation of consumption tax transfers, aiming to periodically ascertain the situation. In the written survey in February 2019, 88.1% of the target businesses answered that all of the tax was transferred for transactions between businesses, and 77.4% answered the same for transactions between businesses and consumers. Meanwhile, 2.2% of the target businesses answered that the tax was not transferred at all for transactions between businesses, and 3.7% answered the same for transactions between businesses and consumers.
Division in Charge
- Fair Trade Division, Business Environment Department, SMEA
- Competition Enhancement Office, Economic and Industrial Policy Bureau