Government to tighten tax breaks for interest payments to prevent tax evasion multinationals

The Japanese government considering tightening of tax breaks for interest payments by companies to prevent tax evasion by multinational companies making use of differences in taxation systems in countries.

Under the present law, up to 50% of the costs for interest payments can be deducted as costs, but in link with an OECD recommendation this will decrease to 30%. The Cabinet will submit a proposal to the regular session of parliament in 2017 at the earliest.  Transfer of interest by multinational companies to group companies located in countries with low corporate taxation level often used by European and US companies, reports Nikkei Online.  There are currently no internationally established rules on this and the OECD is working on setting a framework. The decrease will put Japan in line with European countries such as Germany and Italy, where 30% deduction is common.

 

Source: Nikkei Online, 政府、利払いの税優遇縮小へ 多国籍企業の税逃れ防ぐ 

EU-Japan Centre's News

More
Everything you need to know about the EU-Japan Business Round Table (BRT) and its activities.  …
Everything you want to know in 3 minutes about our 'Technology Transfer Helpdesk' - a service aimed…
Everything you want to know about our 'Minerva' programme ! ✅What is it? ✅Who are the…

Events

More
Japan
16/05/2022 - 27/05/2022
"Due to the current global health situation, the EU-Japan Centre for Industrial Cooperation replaced its 2-week physical programme in Japan by a 2-week online programme. The objective of this…
31/05/2022
31-05-22 | 10:30 - 11:30 AM CET   Do you want to accelerate the transparency, quality and smoothness of strategic planning with Japanese partners?   This webinar aims to provide an understanding…

Library

More
Case study - UAB GELD BALTIC Super GardenFreeze-dried berries, veggies, and ice cream…
BRT video Everything you need to know about the EU-Japan…
Technology Transfer Helpdesk video Everything you want to know in 3 minutes about…
Minerva video Everything you want to know about our 'Minerva'…