2025 Tax Reform Package: Consumption Tax calculation and collection obligations for online platforms
Japan has become the latest country to impose the obligations for online digital platforms to charge and remit Consumption Tax for digital services transactions by non-resident providers on their marketplaces. In the government’s 2024 Tax Reform Package, the Ministry of Finance has proposed imposing the deemed supplier obligation on marketplaces for non-resident merchants selling to Japanese consumers.
This follows Australia, New Zealandand the EU deemed supplier regime.
The Deemed Reseller regime would switch the obligation to determine and charge Japanese Consumption Tax on sales by marketplace traders to local consumers. This would include registering for tax in the case of non-resident platforms. Presently, Consumption Tax registration obligations lie with the non-resident seller, which presents a challenge for the tax authorities to monitor. It also gives non-compliant off-shore sellers a potential tax advantage through evasion.
Japan’s Consumption Tax on electronically supplied services was introduced in 2015.
Tracking and reporting Japanese Consumption Tax – or other international indirect taxes – is a complex exercise. VAT Calc’s single platform VAT Filer can accurately complete any country filings with verified transactional data from our VAT Calculator or VAT Auditor integrated tools.
Asia Pacific VAT on digital services
Comments (click for details) | Rate | Date | Threshold | Comments |
Australia | 10% | Jul 2017 | AUD $75,000 | |
Azerbaijan | 12% | Jan 2017 | – | |
Armenia | 20% | Jan 2022 | AMD 115million | |
Bangladesh | 5% - 15% | Jul 2019 | – | B2B and B2C |
Bhutan | 7% | Jul 2021 | Nu 5million | |
Cambodia | 10% | Mar 2022 | KHR 250m | |
China | 6%-13% | N/a | Nil | Withholding VAT; B2B and B2C |
Cook Island | 15% | 2019 | NZ$ 40,000 | |
Fiji | 9% | TBC | FJD 300,000 | |
India | 18% | Jul 2017 | - | |
Indonesia | 11% | Aug 2020 | IDR600m or 12k customers | |
Japan | 10% | Oct 2015 | JPY 10 million | |
Kazakhstan | 12% | Jan 2022 | Nil | |
Kiribati | 12.5% | 2017 | AU$ 100,000 | |
Kyrgyzstan | 12% | Jan 2022 | Nil | |
Laos | 10% | Feb 2022 | LAK 400m | |
Malaysia | 8% | Jan 2020 | RM500,000 | |
Nepal | 13% | Jul 2022 | Rupees 2m | Also 2% DST |
New Caledonia | 11% | 2020 | XPF 7.5 million | |
New Zealand | 15% | Oct 2016 | NZD 60,000 | |
Pakistan | 2% | Sep 2021 | Nil | Marketplace Withholding VAT |
Palau | 10% | Jan 2023 | $300,000 | |
Philippines | 12% | May 2025 | P 3million | |
Singapore | 9% | Jan 2020 | S$ 100,000 | |
South Korea | 10% | Jul 2015 | Nil | |
Sri Lanka | 18% | 2025? | LKR 60m | Proposals only |
Taiwan | 5% | May 2017 | NTD 480,000 | |
Tajikistan | 14% | Jan 2021 | ||
Thailand | 7% | Sep 2021 | 1.8m Baht | |
Uzbekistan | 12% | Jan 2020 | Nil | |
Vietnam | 10% | Dec 2020 | – |