Retailers Worried ahead of Mandatory Tax-Included Labeling

Tokyo, March 23 (Jiji Press)--As Japanese retailers prepare for the mandatory displaying of consumption tax-included prices for goods and services from April 1, some are concerned that the switch from tax-excluded prices may be misinterpreted as a price hike.

The change, timed to coincide with the start of the new fiscal year, comes as a special measure to allow tax-excluded prices to be displayed on price tags and flyers will expire at the end of this month.

The requirement for tax-included labeling began in April 2004, when the consumption tax rate was 5 pct, and is seen as being beneficial to consumers as it allows them to know at a glance the total amount they will be paying when shopping.

Tax-excluded labeling was allowed under a temporary measure from October 2013 to lessen the burden on businesses of relabeling products ahead of consumption tax rate hikes.

For example, a product priced at 100 yen and taxed at 10 pct could be labeled as “100 yen (without tax)” or “100 yen plus tax.”

[Copyright The Jiji Press, Ltd.]