
Under current regulations, tourists entering Japan on short-term visas are eligible for tax-free shopping benefits. Tax exemptions apply to purchases exceeding 5,000 yen (approximately 850,000 VND) at participating tax-free stores, provided the goods are for personal use overseas.
One difference is that, while in most countries, tourists typically pay the full purchase price including tax at the store and then present the purchase receipt at the airport for a tax refund before departure, in Japan, the process is much simpler as the 10% consumption tax is deducted directly at the store, requiring only a passport from the buyer.
However, this convenient tax-free mechanism is increasingly being abused. Goods purchased tax-free in Japan are being smuggled out and sold overseas in large quantities, at prices including tax plus an additional markup to make a profit.
To address the situation, the Japanese government will implement changes to the system starting in fiscal year 2024. Among the adjustments being considered, a notable change is the procedure for tax exemption, which will require tourists to pay the full amount of their purchases, including tax, at stores, after which they can request a tax refund (possibly at the point of departure, such as at the airport).
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