GGRAsia – Japan tax plans show Suga govt still pushing IRs: Nomura

Japan tax plans show Suga govt still pushing IRs: Nomura

Dec 16, 2020 Newsdesk Japan, Latest News, Top of the deck

The mention of casino resort taxation topics in the latest tax reform proposals of Japan’s governing coalition shows its commitment to the casino liberalisation policy, says a Tuesday memo from banking group Nomura.

“The tax proposals related to integrated resorts [IRs] are for financial year 2022, not financial year 2021,” noted the institution, referring to the term used in Japan for large-scale tourism complexes each containing a casino.

But their inclusion at this stage in the thinking of the Liberal Democratic Party and its partner Komeito gives “some idea of the direction of travel,” added the memo.

Nomura added it was an element in a raft of economic-stimulus policies that are now being referred to as “Suganomics”, after Yoshihide Suga (pictured), the recently-installed successor as prime minister to Shinzo Abe, who previously had the term “Abenomics” applied to his economic liberalisation proposals.

The institution noted that regarding casino taxation there were three specific proposals: to exempt from taxation the casino income of those not classified as residents in Japan; to limit purchase tax allowances – a device used to calculate consumption tax liability – on casino sales; and to clarify the taxation of casino prizes.

“This is an indication that, although the debate about integrated resorts has gone quiet because of the pandemic, the government is still intent on making them a reality,” said Nomura.

Up to three IRs will be permitted in Japan in a first phase of market liberalisation.

Interested local governments must first find a private-sector partner, and then apply to the national government for the right to host an IR.

Japan’s national government said in October that it had shifted the window for it receiving such local-government proposals, to an October 2021 start, and an April 28, 2022 deadline.

Earlier this month it emerged that a draft national basic policy on introducing casino resorts to Japan, approved by a meeting of the LDP, foresees such venues opening only in the “late 2020s”.