Tax is always something to worry about wherever you are in the world. There are many kinds of taxes and although some of these taxes cannot be avoided like income tax, there are also some taxes you can get exempted from under certain conditions. It varies per country and if you are traveling to Japan anytime soon, you should definitely master the rules and regulations about the tax exemptions or the things that are tax-free because it is one of the things foreign shoppers love about Japan.
An Overview of the Old Rules on the Things that are Tax-Free in Japan as a Tourist
Before going crazy with your shopping now that you know that some things are tax-free in Japan, you should first know that this particular perk is only for the tourists in Japan. This makes perfect sense because if it was applicable to everyone in Japan, then the taxing itself would be for nothing since everybody can be exempted from it or have it refunded.
The very first criteria for eligibility is for you to have a visa status that says you are a temporary visitor. This means exactly what you think it means because a person with a student visa is not eligible nor is a person working in Japan eligible for it too. If you have a temporary visitor’s status on your visa but you are staying for more than 6 months, this also renders you ineligible for the tax exemption.
It is like this because this tax exemption was created to make it a little easier for tourists to make the most of their shopping in Japan. The fact that the range of items that this law affects reaches things like home appliances, accessories, shoes, as well as consumable items make it clear that it was made to making staying in Japan a bit more pleasant for those whose intentions are to shop until they can’t shop anymore. It is no trick as well because you can find more than 29,000 stores in Japan, especially in the larger cities like Tokyo, which offer these tax exemptions and tax refunds so you will always be able to utilize it to lessen your money consumption when you buy things in Japan. All you need to read and look out for are the tax-free logos that are usually put up by the entrance or sign of the store.
You can save 8% off anything you buy that falls under the tax exemption law because that is the percentage of tax for those types of items in all of Japan. It isn’t enough that you have a temporary visitor status on your visa though because for the exemption to hold, you must open or use the purchased goods only when you are outside of Japan already. In addition to this condition, you much also do any or all tax refunding on the day that you bought the tax-free item.
There are more conditions that should be met but as of May 1st of the year 2016, these conditions were somewhat modified. The rules prior to this change identified 2 types of items. The first would be the general items and the second would be the consumable items. The old rules for the general items were that the purchased had to amount to more than 10,001 yen (excluding tax) in a day and it had to be bought from the same store. These items also had to be taken out of Japan within 6 months from the time you arrived in Japan. For consumable items, the old rules which were last effective on April 30th in the year of 2016 stated that the amount of your purchase had to be more than 5001 yen and no more than 500,000 yen. As for how long it can stay in Japan for it to still be tax-free, the consumables must be taken out for Japan 30 days after it was purchased.
The Customs, Rules on Check-in, and Limits Used in 2017 That You Should Know Before Shopping for the Tax-Free Things in Japan
Some rules and conditions for the tax exemption system may have changed but there are also some things that stayed the same. The way you avail of these exemptions and refunds are still the same. You still have to either buy the item on a tax-free counter to immediately pay a price for the item that doesn’t include the tax or buy the item for its full price on a regular counter and get back the money you used to pay the tax in the tax refunds counter in the store or in the mall. For malls, it is rare to find tax-free counters in the shops so you would probably end up paying full price for it first and then getting the refund at the customer help desk of the mall.
Now regarding the things that did changes that did happen with the rules of the tax exemption, it is pretty simple because the changes focus on the general items and consumable items that you buy in Japan during your visit. These categories still point to the same items because shoes, bags, accessories, clothes, health food products, and gold equipment are still considered to be general items. As for the things considered to be consumable items, these are cosmetics, cigarettes, foods, beverages, and medicines.
For general items, the conditions that have to be met to avail the tax exemption is for the total amount of the products to reach more than 5000 yen in a single day of buying items from one store. The duration of how long you can keep it in Japan stays the same as you are still able to keep it in Japan 6 months after your arrival to Japan. For consumable items, the conditions that have to be met are for the purchase amount to reach more than 5000 yen and it should also be no more than 500,000 yen for a single purchase in a single store. Like the general items, the duration of which you can keep the consumable items in Japan has not changed as it is still at 30 days from the date of purchase.
The Tax-Free Stores in Japan’s Airport and Why You Should Always Have Your Passport
It is normal to think that the things you can find at the airport are tax-free because a lot of airports in other countries operate this way. In the case of Japan, though, this doesn’t hold because the airport isn’t involved with the consumption tax exemption. However, this doesn’t mean that you cannot buy anything tax-free from Japan’s airport because there are loads of stores and shops that are still tax-free which you can locate at the airport and since these stores are individually licensed to be tax-free stores, it works the same way as those tax-free stores you can find in malls and along the streets.
It was mentioned earlier that purchasing and avail of the tax exemptions in malls mean that you have to purchase or pay for the full amount of the item before you can get the tax money refunded. To do this, you have to be aware of what things to bring and how it works so that you won’t be too lost or too slow when you attempt to refund the said money. After buying the item at a price that is inclusive of GST, you must look for a tax refund service counter or a customer service counter that executes the refunding. Once you have found that, make sure to have your item, your passport, and the receipts of the items you bought. Note that it has to be the official receipt for you to be entertained to be sure to get this. If you used a credit card to buy the items, you’ll need it with you too.
The passport is needed to verify that you are indeed eligible for the tax exemption and also because that is where they will staple the receipts for Japanese customs to check and evaluate on your way out of the country. Once you have shown the counter all the proper documents, they will ask you to sign another document that confirms your claiming of the refund and then they will give you the tax refund in cash for your spending once again.
In case you were wondering, hotel accommodations are not included in the tax exemption system. This isn’t a problem though because it is pretty apparent that this system was able to form a hungrier tourist clientele due to all the savings they get from buying things in Japan. The rules and regulations for this consumption tax exemption are pretty simple but if ever you have questions about it, do not hesitate to research for answers online or to ask a clerk or customer service counter to aid you with your query. These exemptions are always applied so whether you are going on March, May, June, July, or any other month in the year, you will be happy to shop there due to the 8% you’ll be taking home with you after all the shopping.