In this episode of The Japan Perspective, host Joanna Hazel and guest Nicole Baxter, a senior manager in Deloitte Japan’s Indirect Tax group, discuss the effect of the QIS on businesses operating in Japan, providing valuable insights into the challenges faced by buyers and suppliers, and detailing the potential consequences of not holding valid qualified invoices under the new QIS rules. This episode also explores the range of preparation undertaken by affected businesses, from those with a full 12 months of review and planning, to others, particularly in the digital services sector, that are only now reviewing their supply chains.

The conversation then shifts to recent developments in online platform taxation in Japan. Nicole shares insights from a Ministry of Finance study group, which indicates that platform operators are likely to be responsible for collecting JCT on business-to-consumer sales of digital services made by foreign suppliers through online platforms. Other key points include deeming the platform operator as the seller and not imposing a sales threshold on the seller.

The podcast concludes with a brief update on changes to eligibility around claiming import JCT. Nicole explains a clarification issued in June 2023 as to the determination of the importer when there is no underlying import transaction and emphasizes the retroactive application of this clarification to open fiscal years.

The podcast offers valuable insights into these tax developments, ensuring businesses stay informed about the evolving Japanese indirect tax landscape.

The Japan Perspective is a podcast series committed to communicating the latest Japanese tax developments and their potential impact on foreign multinational companies operating in Japan.

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