Japan’s reduced tax rate to cover school, nursing home meals

JIJI

A reduced consumption tax rate is expected to be applied to school lunches and meals served at nursing homes, Finance Ministry officials said Thursday.

The Japanese government plans to introduce the reduced tax rate to cushion the impact of the planned consumption tax increase from the current 8 percent to 10 percent in April 2017.

The reduced rate of 8 percent will cover food and drink, excluding alcohol and eating out, and newspapers.

The ministry officials said that hotel room service meals, catering foods and lunches at company and school cafeterias will be categorized as eating out and subject to the 10 percent consumption tax.

The ministry plans to submit annual tax reform legislation that includes the consumption tax relief plan to the ongoing Diet session possibly in early February.

The ministry hopes the legislation will be enacted by the end of March.