Tax reform

Recommendations

• In reviewing and extending the environmental performance levy, Automobile Tax category levy greening exceptions, and Tonnage Tax eco-car tax incentives, attempts should be made to significantly reduce the tax burden. We would like to request an extension while maintaining the same level as the current systems.
• As the spread of BEVs in Japan remains low, it is needed to accelerate the spread of electrified vehicles that can contribute to the realization of carbon neutrality. In this sense, revisions of schemes that increase burdens on users should be avoided, and maximum tax exemption measures for next-generation vehicles such as BEVs, PHEVs and FCVs should be implemented and/or continued.
• The auto-related taxes of Japan are excessive and complex, when compared with other countries; from a perspective of drastic cut in users’ burdens, streamlining and ensuring fairness, the Tonnage Tax should be eliminated and the Tax Rate for the Time Being (former Provisional Tax Rate) abolished and the Automobile Tax category levy further reduced, and the Automobile Tax environmental levy and the monthly pro-rated levy of the Automobile Tax in the initial year of registration should be abolished.