The standard VAT rate in Japan is 10%. This rate applies to most goods and services provided within the country. However, there are a few exceptions:
- Reduced Rate:
A reduced VAT rate of 8% applies to certain items, primarily food and non-alcoholic beverages, as well as subscription-based newspapers. - Exemptions:
Some goods and services, such as medical care, education, and certain financial services, are exempt from VAT.
Understanding the applicable VAT rates is crucial for accurate pricing, invoicing, and compliance. Consulting a Japanese tax professional can provide clarity on how these rates apply to your specific business activities and ensure proper VAT management.