Japanese Business Glossary

累進課税 (ruishin kazei) refers to progressive taxation in Japan. Japan's tax system is designed so that the tax rate increases as the taxable amount (such as income or profit) increases. In other words, individuals or entities with higher incomes or profits are taxed at higher rates compared to those with lower incomes.

Progressive taxation aims to achieve a more equitable distribution of wealth by ensuring that those with greater financial resources contribute a larger share of their income in taxes. This system is commonly used for income tax, where different income brackets are taxed at different rates.

For example, lower income brackets might be taxed at a rate of 10%, while higher income brackets might be taxed at progressively higher rates, such as 20%, 30%, or more. This approach helps to reduce income inequality and provides the government with a mechanism to collect more revenue from those who are more able to pay.

所得金額 (shotoku kingaku) refers to the amount of income or income amount in Japan after business expenses have been removed. This term is commonly used in tax and financial contexts to denote the total income that an individual or business earns before any deductions, such as taxes or social security contributions.

Calculating the correct shotoku kingaku is essential for accurate tax reporting and compliance with tax regulations. This amount forms the basis for various tax calculations and assessments, impacting the final tax amount that needs to be paid or refunded.

印紙 (inshi) refers to revenue stamps in Japan. These stamps are used as a form of tax payment for certain legal documents and transactions. The use of revenue stamps is mandated by Japanese law to ensure that the appropriate taxes are paid on various types of documents, such as contracts, receipts, and certificates.

When a document requires a revenue stamp, the appropriate stamp must be purchased and affixed to the document. The value of the stamp depends on the nature and amount of the transaction or the type of document. For instance, higher-value transactions typically require higher-value revenue stamps.

Revenue stamps are a way for the government to collect taxes directly linked to specific transactions and legal activities. Using these stamps helps to verify that the required taxes have been paid, thereby ensuring compliance with tax regulations.

脱税 (datsuzei) refers to tax evasion in Japan. This term describes the illegal practice of deliberately avoiding paying taxes owed to the government. Tax evasion can take various forms, such as underreporting income, inflating deductions, hiding assets, or failing to file tax returns altogether.

Engaging in datsuzei is a serious offense that can lead to significant penalties, including fines, interest on unpaid taxes, and even imprisonment. The Japanese tax authorities, such as the National Tax Agency (NTA), actively work to detect and prevent tax evasion through audits, investigations, and enforcement actions.

Compliance with tax laws is crucial for maintaining the integrity of the tax system and ensuring that public services and infrastructure can be adequately funded. Legal tax planning and avoidance strategies, which involve arranging financial affairs within the law to minimize tax liability, are distinct from illegal tax evasion practices.

還付 (kanpu) refers to a tax refund in Japan. This occurs when a taxpayer has paid more in taxes than they owe for a given tax period. The excess amount is returned, or refunded, to the taxpayer by the tax authorities.

A tax refund can result from various situations, such as overpayment of estimated taxes, excess withholding of income tax by an employer, or eligibility for tax credits and deductions that reduce the overall tax liability.

To receive a tax refund in Japan, taxpayers typically need to file a tax return and claim the refund, providing the necessary documentation and calculations to support their claim. The tax authorities will review the return and, if approved, issue the refund. Tax refunds help ensure that taxpayers do not overpay and receive back any excess amounts they have contributed.

賦課金 (fukakin) refers to a levy or assessment, typically a financial charge imposed by a government or public authority. This charge can include various types of mandatory payments, such as taxes, fees, or contributions, which are collected to fund public services or specific projects.

In a business context, fukakin might refer to several financial obligations. These include various types of taxes imposed on businesses, such as corporate tax, consumption tax, and local taxes. It also includes public charges, which are fees for services provided by public entities, like environmental levies, infrastructure development fees, or regulatory compliance costs. Additionally, it covers social contributions, which are mandatory payments to social security, health insurance, or pension funds.

Understanding and accurately accounting for fukakin is essential for businesses to ensure compliance with legal and regulatory requirements in Japan.