Japanese gov’t preparing to introduce ‘exit tax’ on people leaving country

The Japanese government is moving toward preparations to enact an “exit tax” on people leaving Japan starting in fiscal 2019, the first new national tax in 27 years.

The tax would be 1,000 yen per person and be included in the price of the traveler’s plane ticket out of the country. The tax plan will be included in the outline of 2018 fiscal year tax revisions planned to be compiled at the end of 2017 with the aim of enacting the tax the next fiscal year. If introduced, it will be the first new permanent tax since the 1992 land value tax.

In addition to foreign tourists visiting Japan, it will also collect the tax on Japanese citizens leaving the country on vacations or business trips, widely covering all persons leaving the country.

In 2016, the number of people who exited the country was some 24 million foreign tourists and roughly 17 million Japanese citizens for a total of approximately 41 million people. If 1,000 yen was collected from each of these people, it would create a total tax revenue of roughly 41 billion yen — nearly twice the 21 billion yen budget for the Japan Tourism Agency for fiscal 2017.

Prime Minister Shinzo Abe has placed the promotion of tourism as a pillar of his strategy for the growth of the Japanese economy, and has set a goal of increasing the number of inbound tourists to 40 million by the 2020 Tokyo Olympics and Paralympics.

In order to meet this goal, the Japan Tourism Agency plans to strengthen advertising efforts overseas, prepare multilingual sightseeing guides and tighten immigration procedures, hoping to use the revenue from the introduction of the exit tax to realize these policies.

Other countries also collect a similar tax. Australia collects a “Passenger Movement Charge” of 60 Australian dollars (roughly 5,000 yen) per person included in the price of airplane tickets for all persons leaving the country, generating around 80 billion yen in revenue each year.

South Korea also charges an “International Passenger Service Charge ” of 10,000 won (roughly 1,000 yen) for transfers through its airports and 28,000 won (roughly 2,800 yen) for departures. This generates some 26 billion yen in revenue.

Source-Mainichi