Has anybody else been following the news on the upcoming Invoice Seido (System? not sure what the official English lingo will be) for businesses? Starting in October 2023, this will be a requirement for sending invoices / booking costs.
In short, all invoices must have a consumption tax filing registration number on them for the issuing entity. If not, then the receiving entity cannot book that invoice as a cost against their revenues. Obviously nobody will want to pay cash without booking that as a cost, so it locks any invoice-issuing entities into registering for the system.
Aside from extra admin hassle that Japan keeps throwing on businesses, it seems it will also do away with the "exemption" that smaller businesses or freelancers have had. Those making less than 10 mil JPY per year were not required to file consumption tax payments so could keep the 10% on top of their sales. With the requirement to sign up as a filing company and get the number, I guess this vanishes?
Curious what others think about this.
Invoice Seido
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imaginatorium
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Re: Invoice Seido
I hadn't seen anything about this (it's pretty obscure for the ordinary person), but I did predict it (privately, so I can't claim the prize).
The current system is unworkable, unless SHZ/VAT is so low as to not be worth fiddling. The European VAT/TVA/etcetc system is absolutely invoice based, and this is a huge burden on businesses, but it cannot really be avoided. For example, I bought a nice sweater in North Wales in 1997, got a VAT receipt, which I then had stamped by German customs at Waldshut as we crossed into Switzerland, then I was able to claim back the VAT.
Currently we export 99.9%+ of our puzzles, and get to claim back the SHZ on all our (deemed to be SHZ-inclusive) expenses, since no tax is collected on exports. Most of this is our monthly puzzle bill from our wholesalers, so they will have to produce 12 VAT invoices (in EUR terms), and we will be able to write it down accordingly. In principle everything can be checked, because for every purchaser filing an expenses VAT entry, there is a corresponding seller filing a sales VAT entry.
The current Japanese system has some seriously weird aspects. For example, if you buy a 100 yen stamp, it is impossible to say whether this includes (or "is deemed to include") SHZ. If you stick it on a letter to Kagoshima, then it does include tax. If you stick it on a letter to San Diego, it does not include tax.
Currently we also export some jigsaw puzzles bought from Yahoo-oku etc, and can claim back the tax deemed to be included in the price. I am not sure how this will go (perhaps Yahoo will have to charge tax? Or not?) but certainly buying something from a private individual will not result in a VAT invoice, and thus no refund claim.
In the other direction - I used to do technical translation, then when I started the net puzzle shop, I registered for SHZ, to claim back the tax on our puzzle bill. But this meant I had to hand over the tax included in my translation income, whereas everyone I was competing with could just keep it all, unless their annual gross income was over 1000man. With an invoice system, I would have added 10% tax to my bills, whereas the other translators would not, and it would be fair again.
The current system is unworkable, unless SHZ/VAT is so low as to not be worth fiddling. The European VAT/TVA/etcetc system is absolutely invoice based, and this is a huge burden on businesses, but it cannot really be avoided. For example, I bought a nice sweater in North Wales in 1997, got a VAT receipt, which I then had stamped by German customs at Waldshut as we crossed into Switzerland, then I was able to claim back the VAT.
Currently we export 99.9%+ of our puzzles, and get to claim back the SHZ on all our (deemed to be SHZ-inclusive) expenses, since no tax is collected on exports. Most of this is our monthly puzzle bill from our wholesalers, so they will have to produce 12 VAT invoices (in EUR terms), and we will be able to write it down accordingly. In principle everything can be checked, because for every purchaser filing an expenses VAT entry, there is a corresponding seller filing a sales VAT entry.
The current Japanese system has some seriously weird aspects. For example, if you buy a 100 yen stamp, it is impossible to say whether this includes (or "is deemed to include") SHZ. If you stick it on a letter to Kagoshima, then it does include tax. If you stick it on a letter to San Diego, it does not include tax.
Currently we also export some jigsaw puzzles bought from Yahoo-oku etc, and can claim back the tax deemed to be included in the price. I am not sure how this will go (perhaps Yahoo will have to charge tax? Or not?) but certainly buying something from a private individual will not result in a VAT invoice, and thus no refund claim.
In the other direction - I used to do technical translation, then when I started the net puzzle shop, I registered for SHZ, to claim back the tax on our puzzle bill. But this meant I had to hand over the tax included in my translation income, whereas everyone I was competing with could just keep it all, unless their annual gross income was over 1000man. With an invoice system, I would have added 10% tax to my bills, whereas the other translators would not, and it would be fair again.