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11 October 20232 minute read

Japan Customs provide a new definition of “importer of record”

Under the Japanese Consumption Tax Act, the importer of record (“IOR”) is required to pay Japanese consumption tax (“Import JCT”) at the time of importation. While the administrative work for the Customs clearance, including the payment of Import JCT, may be outsourced to a Customs broker, it is still the IOR who is the taxpayer of the Import JCT. In addition, only the IOR is entitled to claim the credit for the paid Import JCT for calculating the JCT liability.

Japan Customs amended the relevant Circular Notices, which came into effect on 1 October and clarify who is eligible to become an IOR. The amended Circular Notices clarify that an IOR:

(1) can freely dispose of the imported goods, or

(2) acts for the purpose of the importation, which includes:

    (i)        A lessee of goods imported under a lease agreement;

   (ii)        A consignment distributor of goods imported for consignment sale in Japan;

  (iii)        A person who processes and repairs the goods which are imported for processing and repair; and

A person who disposes of the goods which are imported for disposal in Japan.


Key takeaway

As those who were eligible under the previous rules, e.g. logistics companies, may no longer become IORs under the amended rules, it may be worth reviewing the existing arrangements used for exporting goods to Japan to confirm who will be the taxpayer of the import JCT and who will be entitled to claim the tax credit for the paid Import JCT.

Reference: Amendment to Import Declaration Items and Customs Procedure Agent System