Business / Economy

Japan to extend deadline for mortgage tax break by a year

Jiji

Japan plans to extend the deadline by which people must move into new homes to qualify for a tax break program for people with mortgages by a year, informed sources say.

The move to relax the eligibility conditions for the program will be included in a tax reform plan to be compiled by the government and the ruling camp as part of its response to the coronavirus pandemic, the sources said Saturday.

Under the plan, the move-in deadline will be pushed back from the end of December.

The plan will be included in a package of economic support measures expected to be drawn up by the government early next month.

Under the current parameters of the tax break program, a certain amount is deducted from borrowers’ income tax and other taxes for 13 years, depending on the balance remaining on their home loans at the end of each year.

As work to build houses has been delayed by the spread of the coronavirus, the government plans to let people be eligible for the tax deductions even if they fail to move in by the December deadline.

Under the upcoming reform, the government will also ease conditions for companies paying corporate and other taxes to rescue those that have experienced revenue plunges on an annual basis.

The easing of conditions will also cover companies that have seen tumbles in revenue on a monthly basis.

The companies to be covered will not be required to provide collateral or pay any overdue tax for the postponement.

The ruling Liberal Democratic Party and junior coalition partner Komeito will hold a meeting soon to work out the details of the tax reform plan.

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