business

Convenience stores want you to be honest and request to pay higher sales tax rate

44 Comments
By Casey Baseel, SoraNews24

It’s only been five years since sales tax in Japan jumped from five to eight percent, and consumers are set to get hit in the wallet again this fall. In October, the sales tax rate is scheduled to rise to 10 percent, although there are a few thankful exceptions.

For one, food and drinks (not counting alcoholic beverages) will remain at eight percent, but with a catch: the lower sales tax is only for items being purchased for consumption elsewhere. For example, if you’re buying a cake at a grocery store, sales tax is eight percent, but if you’re buying one in a restaurant, it’s 10 percent. However, this leaves convenience stores in a bit of a gray area.

For years, Japanese convenience stores have been far ahead of their overseas counterparts in terms of the variety and quality of the food and drinks they offer, and in recent years, several of them have set up “eat-in spaces,” counters or tables with chairs where you can sit down and enjoy the bento boxed lunch, hot bottle of green tea, or seasonal Pocky chocolate sticks you just bought.

▼ Some fancy eat-in spaces even have tablets, USB ports, and power plugs.

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So the question becomes whether sales tax at convenience stores should be eight or 10 percent, and the answer is both. Legally, if you’re buying food and drinks to go, the rate is eight percent, and if you’re buying it to consume on the premises, it’s 10.

The problem, though, is that you make purchases of both types at the same register, so how will the clerk know which tax rate to ring you up with? Simple: if you’re going to be using the eat-in corner, you’re supposed to, out of the goodness of your heart, tell the clerk at the register so that they’ll know to charge you the extra two percent.

That’s the solution the Japan Franchise Association has decided on, anyways, since it doesn’t want to put the burden on employees to have to ask customers about their eating plans. The organization will also be printing and distributing posters for convenience store owners of all brands to put up in their stores asking customers who plan to use the eat-in space to tell the clerk.

That procedure implies that if you say nothing, you’ll be rung up at the cheaper eight-percent rate, and it’ll be interesting to see how if plays out in practice. It seems like there’s an obvious loophole in keeping your mouth shut, then walking over to the eat-in space to chow down on your purchase after you’ve already paid. On the other hand, Japan is a famously rule-abiding society, but then again it’s also a painfully shy one, and the relative lack of small talk and chit-chat in shopping transactions makes it likely that some shoppers will feel awkward announcing “I’m gonna eat this here,” especially if it’s something they feel particularly self-conscious about, like eating a whole sakura cake by yourself in the middle of the night.

Source: NHK News Web via Otakomu

Read more stories from SoraNews24.

-- Six ways to avoid looking like an “idiot” when shopping at Japanese convenience stores

-- Japanese online retailers looking for a change in the sales tax system before they “raise the white flag”

-- Got a cell phone? Soon, you might get a tax bill from the Japanese government too

© SoraNews24

©2019 GPlusMedia Inc.

44 Comments
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It will be just another chance for the state to punish the businesses here.

The forthcoming raids by the tax office will be just another intrusion into life in Japan

-1 ( +2 / -3 )

With the number of convenience stores that abound here in Japan, this is not a small amount of money being talked about. I can see convenience stores closing their lounge areas to avoid having to deal with this headache.

And it's not just convenience stores either, what about food courts at shopping malls that have supermarkets, or customers who ask for take-away and then sit down and eat their food?

Are we going to see the birth of a new cottage industry here? The 2% tax-police?

9 ( +9 / -0 )

Oh what do convenience stores do if the people pay 8% and then do decide to eat on the premises?

Call the cops? Yeah right, I doubt it!

7 ( +7 / -0 )

Sales tax is an unfair tax system.

0 ( +7 / -7 )

Combi's are NOT eat it, they are literally a seat to eat your take out...

-1 ( +4 / -5 )

I know of four local supermarkets that have areas with tables, chairs, and microwave ovens that are clearly meant for people to use to eat items purchased in the market. Three are in department stores and the other is attached to a podunk railway station that has no coffe shops or convenience stores in the vicinity. And those are just the ones I manage to go to. I suspect most of the other many supermarkets in town have something similar. Places like that are going to be in the same situation as the convenience stores.

4 ( +4 / -0 )

"Please charge me more for this item. Thank you" - Not me.

4 ( +5 / -1 )

I'm assuming the extra 2% added charge at restaurants is for the added service coming from the wait staff (bringing refills on coffee, delivering food from the kitchen to the table, etc). If I eat in at a convenience store, I'm not going to get that added service, so why should anyone be charged that extra 2%?

-4 ( +1 / -5 )

If this new sales tax kicks in everyone will need to check their till receipt fr overcharging. Watch the prices increase greater than the tax amounts. Sale tax are unfair because unlike income tax its not based on the ability to paid.

2 ( +4 / -2 )

Another example of Japan to find a way of making EVERYTHING more COMPLICATED than it actually has to be.

8 ( +10 / -2 )

Or,... Japan could get with the programme and STOP taking food from peoples' mouths by taxing them. Some things should NEVER be taxed at the consumer level. Food should NEVER be taxed!

7 ( +9 / -2 )

There's quite a long list of items which should not be taxed.Childrens cloths. Educational and healthcare. Items need for the disabled. Food. All essential items for living including sanity towels for women because only they are forced to pay it. All types of drugs.

6 ( +7 / -1 )

If this new sales tax kicks in everyone will need to check their till receipt fr overcharging. Watch the prices increase greater than the tax amounts. Sale tax are unfair because unlike income tax its not based on the ability to paid.

This. It would be smart to write down the current prices of items you buy often and then compare the prices after the hike. And of course they will show the price before the hike in BIG font and in tiny little font the price after the hike, they did that also with the previous hike which really peeved me off.

2 ( +3 / -1 )

I would like convenience stores to be honest and charge me the true lower price of the product.....

2 ( +3 / -1 )

I hate government.

3 ( +5 / -2 )

Another case of micro managing something into over complication. It’s a simple fix though. Make customers pay ¥100 to use the in store eating facilities as a kind of table charge. At least the funds will stay in the store and not be used to line the government coffers.

-1 ( +2 / -3 )

lol, look how well volunteering to pay NHK TV tax is working out.

5 ( +5 / -0 )

" Make customers pay ¥100 to use the in store eating facilities as a kind of table charge."

That would be like a 60% tax increase.

A beer or juice and corn dog is 300 yen. Im not paying 100 yen to sit down to eat that.

4 ( +5 / -1 )

Food shouldn't be taxed at all. It's common sense in the West. Even the Roman Empire didn't tax food.

3 ( +5 / -2 )

Goes both ways. I want convenience stores to support their customers and clearly label items that have been silently reduced in quantity of the items that they source from. The Giant Ice cream cone is a perfect example. The way things are going, it’s going to be the size of my thumb in a few years.

1 ( +2 / -1 )

Buy a coffee and cigarettes. Pay 10% for the coffee to sit inside and 8% for smoking outside. While drinking your coffee inside you have a few minutes to read the newspaper inside before taking it home to finish reading. This is Japanese govt way. Confuse normal people and fleece them.

0 ( +1 / -1 )

What a mess. Why is absolutely EVERYTHING so bara bara in Japan. It's just impossible for things to be straight forward and clean - streamlined. This economy is starting to choke itself to death.

1 ( +2 / -1 )

Make customers pay ¥100 to use the in store eating facilities as a kind of table charge.

This is the most reasonable solution. Sitting is a luxury in this case.

Im not paying 100 yen to sit down to eat that.

This is the most unreasonable response.

Nobody is making you enjoy the luxury of sitting down.

-1 ( +2 / -3 )

Pink baskets for items you plan to sit down and eat on the premises, and green ones for take-home. No need to speak, and staff will use the till accordingly.

-1 ( +1 / -2 )

Are we going to see the birth of a new cottage industry here? The 2% tax-police?

Their are plenty of older gents with nothing more to do than morning school crossing patrols, reading the sports newspaper, riding around in their Kei truck with a flashing blue light and wearing their favorite WW2 battleship cap to the local LDP meeting. They are begging to be 2% tax police volunteers.

4 ( +5 / -1 )

Foods and medicines are essential to human existence and should not be taxed at all. Likewise for apartment rents. It would be wiser to simply eliminate these taxes outright than consider various types of rebates to seniors and families with children, as is supposedly being deliberated by the Diet.

4 ( +5 / -1 )

What a half arsed system!

i guess the conbini register will give a prompt of eat in or take home adding seconds to each transaction. And gaijin will be carefully watched to see that they follow the rule.

0 ( +1 / -1 )

What a stupid law. They've really outdone themselves this time.

2 ( +2 / -0 )

Coming from Oregon, where there is no sales/consumption tax (except for vice tax), I knew I was going to have to get used to paying such a tax in Japan, but I was absolutely floored when I found out food was taxed here in Japan.

1 ( +2 / -1 )

I'm assuming the extra 2% added charge at restaurants is for the added service coming from the wait staff (bringing refills on coffee, delivering food from the kitchen to the table, etc). If I eat in at a convenience store, I'm not going to get that added service, so why should anyone be charged that extra 2%?

No that is not the reason for the 2%, it's a convoluted system set up to appease a large part of the voting population that does not have underage children.

The 2% increase is supposedly going to be entirely used for social welfare programs for children.

0 ( +0 / -0 )

Coming from Oregon, where there is no sales/consumption tax (except for vice tax), I knew I was going to have to get used to paying such a tax in Japan, but I was absolutely floored when I found out food was taxed here in Japan.

Until this tax increase and the screwed up manner with which it will be implemented there was no tax on food per say.

The tax you were paying was on the purchased items, no matter what they were. The consumption tax and the tax system here did not differentiate between what you were purchasing, it was across the board.

So technically it wasn't the food being taxed, it was the purchase.

Now because the money from the increase is being directed towards a specific area of need, the convoluted system was set up totally to appease those that do not have children, or no longer have to support them. There was a big stir in that elderly voting block against having their "hard earned income" going to support children who pay no taxes. Idiotic, but the reality.

If the original plan went through without all these changes, there would have been a great chance that the LDP would have suffered at the polls across the board.

Hence too, Abe delaying the increase twice, he went through a lot of guano for delaying it the second time, and is already laying the groundwork to do it again, just in case, and even though his partner

0 ( +0 / -0 )

Great.

All we need next is a form to fill out and a stamp to buy, then we will have utopia!

0 ( +0 / -0 )

They should have kept the simple flat rate tax system, hiking it on everything to 10%. And to mitigate the burden on those families who have low or no income, adjust the tax redistributions to them to compensate.

Japan is full of people who can more than afford the extra 2% on their food (seriously - do the maths and understand how much extra money this is per month/year). So let's absolutely have rich people (I include myself) pay this extra sales tax, and keep the system simple.

The whole point of hiking the tax rate is to have more money to redistribute to the needy. That's why there is another hike. So hike it, and give the needy extra money. 

Just do it.

That was the whole point, right?

Alas, instead they decided to make the system more complicated (just the beginning), and give rich people the same treatment as the poor and needy, when they obviously don't need it. Ridiculous. Politically understandable yes, but ridiculous.

I guess it's a miracle that Japan didn't already have a butchered consumption tax system until now though.

0 ( +1 / -1 )

@fxgai: The whole point of hiking the tax rate is to have more money to redistribute to the needy. That's why there is another hike. So hike it, and give the needy extra money. 

You better lay off the bong if you think the extra money is going to the needy. It will maybe go to paying off the enormous debt, followed by political pork barrel projects, and finally if we are lucky it may buy an extra destroyer or two to defend us after Aso puts his foot in his mouth again and offends China and South Korea and North Korea all at once.

0 ( +1 / -1 )

25% of the annual budget is for servicing debt.

-1 ( +0 / -1 )

You better lay off the bong if you think the extra money is going to the needy. It will maybe go to paying off the enormous debt, followed by political pork barrel projects, and finally if we are lucky it may buy an extra destroyer or two to defend us after Aso puts his foot in his mouth again and offends China and South Korea and North Korea all at once.

You may want to read up a little more about where the increase is going to be used here. It is well known that it has nothing to do with the things you stated here.

The money has been earmarked for social-welfare programs aimed at assisting parents with childcare, education, and social-welfare issues targeting them.

If you would read previous posts you would have managed to save yourself the trouble of writing what you did here!

0 ( +0 / -0 )

The money has been earmarked for social-welfare programs aimed at assisting parents with childcare

That's right, I gather than I'm going to be paying less for day care services come October.

Which just strikes me as ridiculous because 

a) I consider myself rich, not needy 

b) we are a double-income household, which is why we need day care services, and also why we can afford to pay for them

c) making stretched day care service free(r) will increase demand for service, potentially making it harder for parents to get their kids into the system

So they should have just hiked the sales tax with a flat rate, and given the extra money to the needy, not to me!! I'm rich I tell you! Hello!?

1 ( +1 / -0 )

This issue presumably applies to fast food chains such as McDonalds as well.

2 ( +2 / -0 )

Some states in the US have had a dual tax system for decades. Food you eat at the location is taxed while food you take out isn't taxed. So at a fast food place you are asked whether it is for eating their or to-go. Not agreeing with the dual tax system or saying it makes sense, but it works with little if any inconvenience. And I have never heard of a consumer or a business getting in trouble for paying/collecting at the wrong tax rate.

Some things should NEVER be taxed at the consumer level.

No matter what level something is taxed at, it becomes a consumer tax. Manufacturers, suppliers, shippers, etc. will all pass on any taxes they pay to the consumer.

0 ( +0 / -0 )

This isn't really anything new interms of taxation. I would view it as they want to hike the tax in general but know it would not make sense or would be too much of burden, cause too much of a uproar on certain areas so they add a rule to provide relief for those areas. This rule often encompasses grey areas such as convenience stores so a decision has to be made. But in reality they weren't too concerned about this area (convenience store) in the first place.

0 ( +0 / -0 )

I'll side with the true Japanese spirit and say "Hmmmm, this is a very difficult situation." and leave it at that.

0 ( +0 / -0 )

I think it should be the other way around. You pay 2% more for take away. A good incentive to reduce packing and waster. Now everyone at the combini will take that extra bag just to pretend they’re eating out

0 ( +0 / -0 )

Stupid rule...

Made on premises vs Eat out.

0 ( +0 / -0 )

I sort of agree with "@that person"... though paper plates being used, or washing ceramic ones would have a greater Carbon footprint, let alone the use of plastic disposables...

No, I stick by my observation that the rule is stupid. The Japanese Tax system is damaging to the Economy and favors those who don't pay Tax or those who are Super rich and don't care.

A while back the 10% flat rate was touted as being simple, because it was across all items uniformly , and now, we hear of this stupid rule... of course I am going to a restaurant and eating out (outside of the location of the cooking area) - there, done sorted 8% not 10%.

0 ( +0 / -0 )

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