Tuesday's consumption tax hike will in principle affect all domestic purchases of goods or services, but there are still gray areas where consumers may get surprised by unexpected levies, government officials warn.
The consumption tax reform law, part of integrated social security and tax changes aimed at doubling the sales levy to 10 percent in 2015, will raise the tax to 8 percent from 5 percent on April 1, and "there are no changes in nontaxable areas," a National Tax Agency spokesman said.
The tax is levied on all goods and services purchased or consumed within Japan, as well as all assets leased, including DVDs and office space. That means any consumption deemed to take place outside the country is basically not subject to the levy.
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