Japan Increases Consumption Tax Rate

As scheduled, Japan has increased its consumption tax rate from 8% to 10% with effect from 1 October 2019. A reduced 8% rate is maintained, however, for sales of food, beverages, and newspapers, although alcoholic beverages and meals consumed in restaurants are excluded and subject to the 10% rate.

The increase to 10% was to be implemented in 2015 but was delayed to April 2017 and then October 2019 based on economic concerns. Although concerns remain, Prime Minister Shinzo Abe has reportedly…