New Regulations Disclosed! Japan Plans to Eliminate Tax Exemption for Small Parcel Imports and 'Preferential Taxable Price Calculation' Starting 2028

[Ebrun Exclusive] February 26th - Recently, Japan's Ministry of Finance unveiled a tax law revision bill, officially titled 'The Bill for Partial Revision of the Customs Tariff Act, etc.', clarifying that effective April 1, 2028, the tax exemption policy for personally used small parcel imports will be completely abolished. Simultaneously, the long-standing preferential rule allowing 'taxable value calculation based on 60% of the overseas retail price' will be repealed.

From that date, all low-value parcels will be subject to full customs duties and consumption tax based on the declared value. Consequently, Japan's two core preferential systems for small-scale personal imports will be phased out.

According to the bill, this regulatory adjustment aims to address issues of tax fairness and system abuse arising from the rapid growth of small-value imports in recent years. The Ministry of Finance believes that against the backdrop of rapid cross-border e-commerce development, the current system objectively leads to erosion of the tax base and creates asymmetric competitive pressure on domestic retailers, necessitating a system overhaul to restore tax neutrality.

For a long time, Japan has implemented a de minimis system for goods for personal use, coupled with a 'preferential taxable price' rule. Although these are independent legal mechanisms, they combine in practice to create a significant tax reduction effect.

Under the existing arrangement, goods for personal use valued at '10,000 yen or less' enjoy tax exemption. Furthermore, when calculating the taxable value, it can be converted at 60% of the overseas retail price. The combination of these two rules effectively raises the de facto exemption threshold to goods with an overseas selling price below approximately 16,666 yen (about 730 RMB), thereby expanding the tax-free scope at the system level.

It is reported that loose policies combined with the expansion of cross-border e-commerce platforms have driven a continuous increase in the volume of tax-exempt small parcel imports into Japan. Public reports indicate that in 2024, approximately 170 million low-value imported items (valued within 10,000 yen) entered Japan, a figure about five times higher than the levels seen in 2018 or 2019. Some industry analyses further predict that the number of related parcels could exceed 200 million by 2025.

Against this backdrop, discussions on reforming the small-value import tax exemption system have gradually intensified.

In May 2025, Japan's Ministry of Finance and a government expert panel began a systematic assessment of the import tax exemption system, including for small parcels, focusing on issues such as tax base erosion due to cross-border e-commerce utilizing exemption rules and the imbalance in the competitive environment for domestic retail.

In early December 2025, the Liberal Democratic Party's internal tax system research body proposed a draft tax revision bill, explicitly recommending the complete abolition of the consumption tax exemption policy for all low-value imported goods.

Currently, according to the procedural schedule, the Japanese Diet will deliberate on the aforementioned tax reform proposal throughout 2026, with the final legislative process for the relevant tax law revisions expected to be completed between January and March 2027.

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