Japanese Govt Moves Forward with Plan to Tax Foreign Retailers

Kindle in Japan - 05Here’s a bit of news for authors and publishers who sell direct.

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 moving forward:

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.

8634508797_37d13af1e1[1]Is anyone else wondering how exactly they’re going to enforce this?

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.

The Japan News

images by ThemeplusSteve Nagata

Nate Hoffelder

View posts by Nate Hoffelder
Nate Hoffelder is the founder and editor of The Digital Reader. He has been blogging about indie authors since 2010 while learning new tech skills weekly. He fixes author sites, and shares what he learns on The Digital Reader's blog. In his spare time, he fosters dogs for A Forever Home, a local rescue group.


  1. Kevin24 December, 2014

    No, the Japanese government probably doesn’t expect to get tax from all online sellers. But getting just the major ones like Amazon, Apple, LLBean, Google Play Store, Dell, etc., (who all have sites and subsidiaries in Japan available for punitive measures) would probably get 80% of the online market fairly easily. Compared to the nothing they get now, the government probably think it is a fairly easy way to go.

  2. Fahirsch24 December, 2014

    And without officialy spying, how is the Japanese goverment to know that a inhabitant of Japan has bought something?

    1. Kevin25 December, 2014

      The gov. asks the company to send them a list of all their customers in Japan. If they refuse, the gov. threatens to retaliate against their online or physical stores in Japan (e.g., amazon.co.jp). If they still refuse, you ask the Japanese ISP providers to provide copies of all messages from the overseas sites to Japan and search it for evidence of this crime. Welcome to the real world.

  3. January 2015 inSCRIBE | Forward Focused™7 January, 2015

    […] eBooks sales: a new tax for Indie authors might trend across the world. Non-US based digital works released in Japan will be charged a consumption tax, specifically those sold by Amazon. Read more… […]


Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Scroll to top