In Japan just like most countries around the world, Property Taxes or the Fixed Asset Taxes（固定資産税）are assessed on real estate (real property and the land).
The tax rate for property taxes are 1.4% of the assessed value of the property which is provided by the National Tax Agency (NTA). These values are revised every three years.
Just as we wrote about in our last blog, Home Owner’s Tax Deduction Amendment (2021), COVID-19 has negatively impacted the economy as a whole in Japan. The Central Government is trying its best to ease the burden caused by COVID-19 by creating a tax reform for property taxes in 2021. The goal of this reform is to lower the tax burden by the amount the land values increased prior to the start of the pandemic.
Tax Relief Measures
The tax relief measures for property taxes in 20201, we will find;
The value for the land will be assessed from the date January 1, 2020. This date will precede the COVID-19 outbreak in Japan.
In the cases where the tax amount is greater in 2021 than in 2020 due to the increase in land value, the tax payer will be able to pay the lower amount which was assessed in 2020. Also, if the tax payment is lower in 2021 compared to 2020, the tax payer will pay the lower amount of the two for fiscal 2021.
In more simple terms, the tax payer will pay the lower amount of the tax amounts assessed in 2020 and 2021.
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