Japanese businesses brace for tax cut
Restaurant operators are poised to expand take-home meals, such as bento boxed meals and other precooked dishes, to cope with a wider tax gap between eat-in meals and takeout.
Japanese businesses are preparing for a significant change in the consumption tax on food items, with the rate dropping from 8% to 1% for two years starting next April. This shift is expected to widen the tax gap between dine-in meals and takeout food, currently at 2 percentage points, to 9 points. Restaurant operators anticipate a potential decline in customers due to the higher tax on dine-in orders, while the take-home and delivery meal services are anticipated to increase.
Several restaurant chains, including Watami, Zensho Holdings, and Royal Host, are ready to adapt to the new tax structure. However, the transition may pose challenges, particularly in updating cash register systems, which typically takes around six months. The industry has called for government measures to boost demand, such as issuing premium dining vouchers.
Additionally, the tax cut could negatively impact small-scale farmers, as the reduction in revenue from the tax cut may be passed on to them. The Central Union of Agricultural Cooperatives has urged the government to provide support for both restaurant operators and small-scale farmers.
Written by urgent.news from Japan Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
