Japan Could Give Tourists Tax Break On Alcohol

the drinks business

By Lauren Eads

August 22, 2016

Japanese alcoholic drinks such as sake and Japanese whisky could become exempt from tax for foreign tourists if a request by its tourism agency is accepted.

According to Kyodo News, the Japan Tourism Agency wants to exempt tourists from paying tax on domestically produced alcoholic beverages to help boost demand in international markets and build Japan’s growing alcoholic drinks industry overseas.

The exemption will apply to alcoholic drinks sold at the production sites marked by local tax offices, as well as approved shops where such goods are sold. However under Japan’s tax-free shopping system for foreign visitors, the purchaser will not be allowed to transfer or consume products while in Japan.

The request is expected to be officially made to Japan’s Finance Ministry ahead of its annual tax changes for the next fiscal year, with any changes not expected to take affect until April next year.

Japan’s liquor tax is dependent on the types of alcohol and abv, with the tax on a 720ml bottle of sake 86.4 yen (about 86 UScents/65 pence), according to the English-speaking Japanese news site. A 750ml bottle of wine is subject to tax of 60 yen, with tax on a 350-ml can of beer 77 yen.

In October 2014, the Japanese government expanded its list of duty-free items for foreign travellers. As a result, sales of foods and cosmetics have grown and foreigners who visit Japan for shopping purposes have been on the rise, with Japan recording a record 19.74 million foreign visitors in 2015.

“If the number of foreign tourists who buy sake rises and raises the profile of Japanese sake culture, it is expected that exports will expand and foreign visitors will grow,” an agency official told Kyodo News.

Japanese whisky is already well-established and earning critical recognition outside of its native country, while sake and Shochu is steadily growing in popularity.