Article 28 (Tax Base)

1. The tax base for consumption tax on Taxable Transfers of Assets shall be the Price Amount (this shall be the entire amount of cash or goods other than cash or rights or other economic profits received or to be received and does not include the amount equivalent to the amount of consumption tax to be levied regarding Taxable Transfers of Assets nor the amount of local consumption tax to be levied using said amount of consumption tax as the tax base--for purposes of this paragraph and the next, the same) received for the Taxable Transfer of Assets. Provided, that in case a Juridical Person has transferred assets to an officer as provided for in Article 4, Para. 4, Item 2, when the Price Amount is remarkably low in comparison with the value of said assets at the time of said transfer, the amount equivalent to that value shall be considered to be the Price Amount.

2. Regarding those activities mentioned in the items of Article 4, Para. 4, the amount of money specified in each item below shall be considered the Price Amount for the activity specified.

1. Consumption or use, as mentioned in Article 4, Para. 4, Item 1 -- the amount of money equivalent to the value of the asset used or consumed at the time of said use or consumption.
2. Gift, as mentioned in Article 4, Para. 4, Item 2 --the amount of money equivalent to the value of the asset given at the time of said gift.

3. The tax base for consumption tax on Taxable Goods removed from a Bonded Area shall be the amount of money that is the value calculated according to the provisions of the Customs Tariff Law (1910, Law No. 54), Articles 4 through 6-8 (Methods of Calculating Tax Value) added to the amount equivalent to any consumption taxes other than this consumption tax (said consumption taxes are those provided for in the General Law of National Taxes, Article 2 (Definitions), Item 3) or any customs duties on the removal of said Taxable Goods from the Bonded Area.

4. In addition to the provisions of Paragraph 2 above, any necessary considerations concerning the particulars of calculating the tax base amount provided for in Paragraph 1 and the previous paragraph shall be specified in cabinet orders.

Cross Reference: Consumption Tax Law Enforcment Order Article 45.

Historical Notes:
1994 Amendment. Law No. 109, 1994 inserted "nor the amount of local consumption tax to be levied using said amount of consumption tax as the tax base".

Article 29 (Tax Rate)

The tax rate for the consumption tax shall be four percent (4%).

Historical Note:
1994 Amendment. Law No. 109, 1994 substituted "four percent (4%)"for "three percent (3%)" to be effective from April 1, 1997.

© 1989, CCH International; © 1997, Vicki L. Beyer

Temple University Japan