The Japan Tourism Organization has announced that starting Oct 1, 2014, Japan will be expanding the tax exemption benefits allotted to foreign non-resident tourists (anyone who has lived in Japan less than six months) from general goods to also include consumables. These tax-free stores are different from duty-free shops which deal with custom or border taxes
Currently, Japan has 5,777 “export sales” stores (tax-free shops) with most being located in the Tokyo and Osaka areas; however, the Japan Tourism Agency is looking to expand the number to 10,000 and focus on regional areas to increase the sales of local specialty goods.
Compared with the European Union, Japan’s system has the advantage of having the product sold at the tax-free price at the time of purchase instead of collecting a refund upon departure; or later in the case of credit card purchases. With those refund procedures and agency fees eliminated, the tourist can purchase products at a lower price, encouraging added consumption.
From Oct 1, the tax-free system will be expanded from general goods such as home electrical appliances, clothing (kimonos) and handbags to also include consumables including groceries, medicine, cosmetics, etc. The monetary range for consumables falls between 5,000 yen and 500,000 yen purchased on the same day in the same store for one non-resident.
Originally published on www.japantoday.com