For the past year or so the Japanese government has been exploring the idea of requiring foreign retailers to Japanese consumption tax on digital good sold to Japanese consumers, and now they’re:
Under the envisaged system, digital media sold by vendors whose headquarters are located outside Japan will be subject to taxation, the sources said. Such firms include Amazon.com Inc. in the United States and Kobo Inc., Rakuten Inc.’s affiliate in Canada.
The measure will be incorporated into the fiscal 2015 tax reform outline that the Liberal Democratic Party and its junior coalition partner Komeito aim to adopt on Dec. 30.
The government plans to submit a bill to reform the consumption tax system in next year’s ordinary Diet session. The new taxation is set to go into effect on Oct. 1.
Once the new system is in place, overseas business operators will be obliged to pay taxes to relevant tax offices in Japan. The cost will likely be passed on to consumers.
One estimate said that Japanese consumers bought around 35 billion yen (~$290 million USD) in ebooks from overseas in 2012. Assuming that all of the consumption tax could be collected, it would boost government revenues by around $23 million USD.
Yes, most of the major ebook retailers already have a presence in Japan, and thus they can be pressured into collecting the consumption tax (which they really should have been collecting all along). But when it comes to retailers that don’t have a presence in japan, how exactly is the Japanese govt going to bell the cat?
I have the feeling that we’re either looking at a plan concocted by the underwear gnomes or the Japanese govt doesn’t reasonably expect to collect all that it believes is its due. (That’s more sense than we are accustomed to getting from national governments, but still …)
In any case, if you want to start getting ready to collect Japan’s consumption tax, you can find more info on the Japanese National Tax Agency website.