Confusion Seen over 2-Tier Tax Rate as Planned Hike Approaches

Economy Politics Lifestyle

Tokyo, Sept. 1 (Jiji Press)--With the planned consumption tax hike in Japan approaching, consumers and businesses are worried about potential confusion over differences in tax rates for similar goods.

While the standard rate of the tax is slated to rise to 10 pct from 8 pct on Oct. 1, the rate for some goods, such as foods and non-alcoholic beverages, will be kept at the current level.

On its website, the National Tax Agency has posted related guidelines including examples of what qualifies for the lower tax rate, but reality is expected to not be so clear-cut.

One example of potential confusion is the treatment of "mirin" sweet cooking wine. Mirin itself will be taxed at 10 pct as it is alcoholic, but seasoning that mimics mirin and has low levels of alcohol will be taxed at 8 pct.

Another, more complicated example is of sushi at restaurants. Foods eaten at sushi-go-round restaurants, like other foods and drinks for dining out, will be subject to the raised tax rate. On the other hand, if sushi is purchased at restaurants as takeout, the 8 pct rate will be applied. However, if sushi left over from dining at restaurants is taken out, the tax rate will be 10 pct.

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