Japan's consumption tax will be cut for the first time, with the rate on food items (excluding restaurant meals) falling from 8% to 1% from 1 April 2027 for two years. Prime Minister Sanae Takaichi announced the measure to support households amid rising living costs. The change marks a historic first reduction in Japan's consumption tax since its introduction in 1989.
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VatCalc · 5 months ago
Japan is considering a temporary withdrawal of the 8% reduced consumption tax on food for up to two years, with the bill slated for the Autumn 2026 Diet session. The move would cut annual tax revenue by about ¥5 trillion, while the current standard rate remains 10% with an 8% reduced rate for food. The ruling LDP has resisted the cut, citing the tax's importance for funding social security.
KPMG · 7 months ago
Japan’s ruling coalition agreed in December 2025 to an outline of 2026 tax reform proposals covering corporate, international, consumption, and individual tax. The proposals include amendments to Pillar Two global minimum tax rules and new measures for consumption tax, R&D credits, and domestic production incentives. The outline is indicative and subject to legislative approval.
TaxO · about 1 hour ago
India: The GST Appellate Tribunal ruled that GST authorities cannot challenge undisputed pre-GST credits under Section 74 of the CGST Act. The decision confirms that transitional credits from CENVAT, Krishi Kalyan Cess and VAT cannot be denied without specific findings, and Section 74 penalties are unsustainable.
VatCalc · 6 days ago
Vietnam has introduced optional e-invoicing for foreign businesses, allowing them to issue Vietnamese electronic invoices to improve VAT recovery. The changes, effective from 1 July 2026, also provide flexibility on invoice timing and extend mandatory e-invoicing to larger domestic businesses.
TradeBrains · 7 days ago
India's GSTN will implement new e-invoicing and e-way bill rules from 1 August 2026, making Ship-to GSTIN mandatory for applicable transactions, tightening validation checks, and introducing a voluntary e-way bill closure facility. Businesses must update ERP and billing software, capture Ship-to GSTIN details, and integrate the new e-way bill closure API to remain compliant.
NationThailand · 7 days ago
Thailand’s Cabinet has approved a one-year extension of the 7% VAT rate from 1 October 2026 to 30 September 2027. The extension keeps the reduced rate at 7% (including local tax) for all sales of goods, services and imports, easing living costs and supporting economic stability.
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Key Takeaways
As of 1 April 2027, Japan's Prime Minister Sanae Takaichi announced that the consumption tax on food items will be reduced to 1% from the previous 8%.
The reduction takes effect on 1 April 2027 and will apply for a period of two years.
The cut applies only to food items purchased at stores and does not cover restaurant meals.
Primary source
Read the full article at Japan TimesThis summary was published on VATfaqs.com on 3 August 2026. It relates to VAT developments in Japan. The original source is Japan Times.
