Japan's consumption tax in brief
Japan charges a consumption tax (消費税, shōhizei) on most goods and services. The standard rate is 10%, made up of 7.8% national tax and 2.2% local tax. A reduced rate of 8% applies to food and non-alcoholic drinks (but not to eating out, alcohol or medicine) and to newspapers delivered at least twice a week on subscription.
The line between the two rates surprises many visitors. The same rice ball or burger is taxed at 8% if you take it away and at 10% if you eat it in the shop, because eating in counts as dining out. That is why convenience-store and fast-food staff ask whether you will eat in (tennai) or take away (mochikaeri). Alcohol is always 10%, even in a supermarket.
Reading Japanese price tags
Since April 2021 shops must show the total price including tax to consumers, but many still print the pre-tax price in large type and the tax-inclusive price smaller. Look for these words:
- 税込 (zeikomi): tax included. This is what you pay.
- 税抜 (zeinuki) or 本体価格 (hontai kakaku): before tax.
- 内税 / 外税: tax included in / added to the price, usually on receipts.
How the calculation works
- Before tax → with tax: tax = price × rate, rounded; total = price + tax. ¥1,980 before tax at 10% becomes ¥2,178.
- With tax → before tax: tax = price × rate ÷ (100 + rate), rounded. A ¥1,980 tax-inclusive price at 10% contains ¥180 of tax, so the pre-tax price is ¥1,800.
Businesses choose how to round fractions of a yen, and rounding down is the most common. On a qualified invoice the tax is rounded once per invoice for each rate, not item by item, so a receipt total can differ by a yen or two from adding up items yourself. The calculator works in whole yen, so there are no floating-point errors. The last line shows which pre-tax prices produce exactly the tax-inclusive price you entered; because of rounding there can be two, or none.
Tax-free shopping for visitors (refund system from 1 November 2026)
Visitors to Japan who are not residents can get the consumption tax back on goods they take out of the country. The system changes for purchases made on or after 1 November 2026, according to the Japan Tourism Agency:
- You pay tax at the till, then get it refunded. Instead of buying tax-free at the shop, you pay the full tax-inclusive price. The tax is refunded after customs confirms at the airport or seaport that you are taking the goods out of Japan.
- Minimum ¥5,000 before tax per store per day. The calculator above tells you whether a purchase reaches it. A ¥5,500 item including 10% tax is exactly ¥5,000 before tax and qualifies; a ¥5,400 item is ¥4,910 before tax and does not on its own.
- Leave within 90 days of purchase, and scan your passport at a tax-free procedure terminal at the airport or seaport before you board. A "green" result means no inspection; "red" means you show the goods at the customs counter.
- The separate rules for "consumables" are gone. There is no longer a ¥500,000 cap on food, cosmetics and medicine or a sealed-bag requirement, but you must not use or eat consumables in Japan. If you do, tell customs and do not claim the refund for them.
- Only what you carry out yourself qualifies, and if you bought several items on one receipt, all of them must be with you when you leave.
- The refund is paid by the shop or a refund company working for it, by the method the shop tells you. Ask at the time of purchase how and when you will be refunded and whether any fee is deducted, because the amount you receive can be less than the full tax.
Purchases made up to 31 October 2026 follow the previous rules. If you live in Japan, including as a foreign resident with a work or student visa, tax-free shopping does not apply to you.
Frequently asked questions
- How much tax is in ¥1,980?
- At the 10% rate, ¥1,980 including tax contains ¥180 of tax, so the price before tax is ¥1,800.
- Why did my takeaway cost less than eating in?
- Food and soft drinks you take away are taxed at the reduced 8% rate, while eating in the shop counts as dining out and is taxed at 10%.
- Do I still get tax-free prices at the shop after November 2026?
- No. From 1 November 2026 you pay the full price including tax, and the tax is refunded after customs checks your goods when you leave Japan.
- Can I combine purchases from different shops to reach ¥5,000?
- No. The ¥5,000 pre-tax minimum applies to purchases at one store on one day.
Last updated: 2026-10-28