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2007 Assessment

Japan: Integrity Indicators Scorecard

Japan: Integrity Scorecard Report > Sub-Category: Taxes and Customs
Indicators		Score
58	In law, is there a national tax collection agency?	100
59	Is the tax collection agency effective?	100
60	In practice, are tax laws enforced uniformly and without discrimination?	75
61	In law, is there a national customs and excise agency?	100
62	Is the customs and excise agency effective?	100
63	In practice, are customs and excise laws enforced uniformly and without discrimination?	100

Indicator and sub-Indicator Details

In law, is there a national tax collection agency?

58: In law, is there a national tax collection agency?

Score:

YES

Comments: The National Tax Agency (NTA) was established in 1949 as an independent organization of the Ministry of Finance in order to assess and collect national taxes, etc. For the organizational structure of the NTA, you can obtain detailed information from [ LINK ].

References: NTA Web Page. [ LINK ] Minute Explanation of the MOF Functions. [ LINK ]

Is the tax collection agency effective?

59a: In practice, the tax collection agency has a professional, full-time staff.

Score:

100

Comments: The The National Tax Agency (NTA) was established in 1949 as an independent organization of the Ministry of Finance in order to assess and collect national taxes, etc. For the organizational structure of the NTA, you can obtain detailed information from [ LINK ].

References: Government studies. International organization studies. National Tax Collage Web Page. [ LINK ] NTA Web Page. [ LINK ]

59b: In practice, the tax agency receives regular funding.

Score:

100

References: Government studies. International organization studies. National Tax Collage Web Page [ LINK ] NTA Web Page [ LINK ]

In practice, are tax laws enforced uniformly and without discrimination?

60: In practice, are tax laws enforced uniformly and without discrimination?

Score:

100

Comments: Generally speaking, Japanese tax laws are impartial. For example, there is the administrative appeal system that allows a taxpayer to protest against tax authority decisions. Furthermore, if the problem is not resolved, a taxpayer can appeal to the National Tax Tribunal. In practice, voluntary compliance with tax law often causes a questionable nation-wide tax gap among people. People in Japan feel that, 90 percent of the income of salaried employees has been captured in the tax system although self-employed people only declare about 60 percent and farmers 40 percent. It is called "the 9-6-4 problem."

References: Media reports. Academic, policy or professional studies. Government studies. NTA Web Page. [ LINK ] MOF Web Page. [ LINK ] National Tax Tribunal Web Page (only available in Japanese) [ LINK ] ASG Tax Corporation (2007). "2007 Tax Reform." Japan tax bulletin No9 January 2007. [ LINK ] (Japanese tax system reform) Vicki L. Beyer (1994). "Tax Administration in Japan." Revenue Law Journal 4:2, 144-159. http://epublications bond.edu.au/rlj/vol4/iss2/3/

In law, is there a national customs and excise agency?

61: In law, is there a national customs and excise agency?

Score:

YES

Comments: Japan Customs collect customs duty, consumption, and other taxes on imported goods. On the other hand, the National Tax Agency (NTA) collects excise taxes domestically.

References: Japan Customs Web Page [ LINK ] MOF Web Page [ LINK ] NTA Web Page [ LINK ] The National Tax Law (1962). National Tax Collection Law (1960). Custom Law, Custom Tariff Law and Temporary Tariff Measures Law. [ LINK ]

Is the customs and excise agency effective?

62a: In practice, the customs and excise agency has a professional, full-time staff.

Score:

100

Comments: Japan Customs and the National Tax Agency (NTA) have a special institute for training staff. Since their missions are highly professional, both agencies always have well-trained professional staffs. In particular, since Japan Customs has a good reputation, Japan Customs plays one of the leading roles on the custom integrity and administration in Asian religion.

References: Government studies. International organization studies. Japan Customs Training Institute Web Page. [ LINK ] National Tax College Web Page. [ LINK ] ADB CAREC Regional Trade Facilitation Program. [ LINK ]

62b: In practice, the customs and excise agency receives regular funding.

Score:

100

Comments: The central Customs administration is an internal bureau of the Ministry of Finance. The funding of Japan Customs is from the national budget.

References: Media reports. Government studies. MOF Functions. [ LINK ] Japan Customs Organization. [ LINK ]"

In practice, are customs and excise laws enforced uniformly and without discrimination?

63: In practice, are customs and excise laws enforced uniformly and without discrimination?

Score:

100

Comments: Since Japan Customs keeps well-trained, highly integral professionals, they seldom have to enforce impartial treatment. Strict penal laws and media scrutiny also help to deter corrupt, impartial treatment for people.

References: Academic, policy or professional studies. Government studies. Japan Customs Web Page. [ LINK ] Yoichiro Tachi (2001). "An Overview of the Japanese Criminal Justice Legislation," 3rd annual conference of the ADB/OECD Anti-Corruption Initiative for Asia-Pacific, Tokyo, November 2001. [ LINK ]"