Recently, many sellers on Amazon Japan have received news from the platform about the "Reform of the Japanese Consumption Tax ( JCT ) Compliance Invoice Retention System".
The full name of Japanese Consumption Tax , or JCT for short , is a tax that consumers pay when purchasing goods. Japan's consumption tax system has been implemented since 1989 , and the tax rate was officially announced at 10% in 2019 . GST is a circulation tax, but is ultimately borne by the buyer.
This policy change mainly affects corporate buyers, and there is no change to individual consumers who do not include corporate purchasing purposes. For corporate buyers, buyers who need tax deduction before October 1 , 2023 can enjoy JCT input deduction even if the JCT registration number is not displayed on the invoice . From October 1 , 2023 , buyers who need tax deduction need to provide a compliant invoice with the seller 's JCT registration number before they can apply for JCT input deduction. If the invoice does not meet the new system requirements, the buyer's tax will not be deductible.
Therefore, sellers with JCT tax obligations need to apply for a JCT registration number to the Japanese tax agency before the regulations take effect, so that they can issue compliant invoices to buyers who need tax withholding after the regulations take effect.
Of course, we are more concerned about the impact of this change on sellers.
As an important online e-commerce website in Japan, Amazon has not only individual consumers shopping on Amazon Japan, but also a large-scale corporate purchasing behavior. And sellers who open a Japanese station will sell to both individual consumers and enterprises at the same time. According to Amazon data, as of November 2021 , more than 90% of Amazon's Chinese sellers have received orders from overseas corporate buyers.
In addition, Amazon Japan has several big promotions for corporate buyers every year . In order to provide business buyers with a good shopping experience, the Amazon business website will also be changed at that time. When buyers browse products, they will see JCT related marks on the product detail page . If the mark is displayed, the seller of the item is able to provide a compliant invoice with a JCT registration number.
It is foreseeable that after the invoice retention system takes effect, companies that need tax deduction may pay more attention when purchasing goods and choose sellers who can issue compliant invoices with JCT registration numbers.
Therefore, for sellers on Amazon Japan, it is more important and urgent to register for the Japanese consumption tax number before the new regulations take effect, and obtain the qualification to issue invoices that meet consumption tax compliance.
How can a seller determine if there is a JCT tax liability? It mainly depends on whether any of the following conditions are met:
1. Taxable sales in the "base year 2 " exceed 10 million yen.
2. The taxable sales in the "base year 2 " do not exceed 10 million yen, but the taxable sales in the first half of the "base year 1 " exceed 10 million yen.
3. The registered capital of the company is more than 10 million yen.
Therefore, sellers who meet the requirements are reminded to register for JCT as soon as possible , and the detailed application and registration process can be viewed on Amazon's global store official account to ensure compliance.