Increase Of Consumption Tax Rate

Effective as of April 1, the combined rate of national and local consumption taxes has increased from 5 percent to 8 percent (6.3 percent national tax and 1.7 percent local tax). The consumption tax rate is planned to further increase from 8 percent to 10 percent (7.8 percent national tax and 2.2 percent local tax) on October 1, 2015. Accordingly, subject to certain exceptions, consideration paid for the transfer or lease of assets or the provision of services for business purposes on or after April 1, is subject to the new 8 percent consumption tax rate. However, the consumption tax rate of 5 percent will apply to any transfer or lease of assets or provision of services for business purposes occurring prior to April 1, even if such consideration is actually paid on or after April 1.