Does Japan have an IRS?

[wasabijuice]

Good points there Sangetsu, if you live frugally you can avoid lots of the hidden taxes.

But I have to say 6liter engine???OMG what in the hell are you driving , a tank? What number plate is that beast???

[blimp]

i think i paid 23.5 % last year in income and resident tax, pension and insurance, with a substantial deductible. at least more than many european countries.

whether the 財務省 is corrupt or not, i wouldn't know. i don't think japan is really debating whether or not the government has the right to tax its residents. please be aware that some taxes are not handled by the tax office. neither was the tax office responsible for the loss of pension records.

[wasabijuice]

In the taxes you mentioned, I probably paid about 9%. It shows the difference between life in the inaka and life in the city. Which is better, is up for you the reader to decide. Still 23% is not bad.

[sarasi]

The resident's tax is based on how much you earn, although there are slight variations between areas. Not everyone in Sangetsu's area will be paying $1,200, and not everyone is his girlfriend's area will be paying $7,000. It's a percentage of your income- where I live, close to 8%.

I disagree that most foreigners living in Japan are unaware of the resident's tax. Many of those who arrived in the last year, perhaps. The rest of us are very aware of it, since we have to pay it every year.

[Sangetsu]

Originally Posted by sarasi

The resident's tax is based on how much you earn, although there are slight variations between areas. Not everyone in Sangetsu's area will be paying $1,200, and not everyone is his girlfriend's area will be paying $7,000. It's a percentage of your income- where I live, close to 8%.

I disagree that most foreigners living in Japan are unaware of the resident's tax. Many of those who arrived in the last year, perhaps. The rest of us are very aware of it, since we have to pay it every year.

Those foreigners who stay one year or less are exempt from residency tax, and most foreigners do, in fact, stay 1 year or less.

The percentage you pay is not entirely based upon your income, but relies also on your geographic location. The rates are often higher in the countryside than they are in the city in order to compensate for having a smaller tax base.

[sarasi]

I think you are perhaps thinking of English-speaking foreigners when you say that most foreigners stay less than a year. The majority of foreigners in Japan are from China and Korea, and they are long-term residents. I don't even mean those who were born in Japan but still hold foreign nationalities- the number of immigrants from those countries vastly outnumber those from western countries.

This is based on statistics I have seen regarding numbers of immigrants from each nationality, but I may be wrong- can you point me towards some statistics which show that most foreigners stay a year or less?

I realise that depending on the area the resident's tax varies by up to a few percentage points. It is not as simple as "people in one area pay $1,200 while people in another pay $7,000" though- a system that charged people from some areas 5 times more than those in others would obviously be unworkable.

The main factor in the amount of tax is the person's income.

[Nyororin]

Wow, how I wish we only had to pay 5% in income tax. How great that would be!!

In reality, we pay much much more. It`s just split into multiple categories. You get gouged all the same.
I have my husband`s pay slip right here. While I don`t want to go into details on how much he earned, I`ll list percentages and flat costs.
Last month;
2.5% for healthcare
6.5% for social security
0.5% for "general security"
1.5% for "income adjustment"
3.0% for residential tax

A total of 14% taken directly from the paycheck.
We also pay 5% from the yearly income in property tax and another 5% for income, which is paid in a yearly bundle except for overtime and bonuses (they are paid as "adjustment"). For our summer bonus, 7.5% of it went to income taxes. I THINK that overtime is also calculated on a different scale but really am not sure.

So, I`d say between 23~25% regularly.

The residents tax, by the way, has little to do with your income. It is MOSTLY based on the value of the property where you live. Live somewhere with pricey property, then it`s going to be a lot higher than if you live out where land is cheap.

Personally, I don`t have any issues with the taxes as the level of government provided services matches the amount. If they were just sucking the cash away and not doing anything with it, I think I`d feel differently though.

[noodle]

Originally Posted by wasabijuice

Japanese income taxes are insanely LOW. About 5% if you make 1senmanen or less. That's 100,000USD folks. In the states you'D be lucky to take home 60K of that. The problem is cost of living is skyhigh if you live in the city and like to use highways, eat meat and fruit etc. The reason there are so many expats here is the J-gov lets you keep most of your pay.

It'S amazing how much a government can save when you don't have to pay for 11 aircraft carrier battle groups, overseas military bases, etc.

Local taxes are however rising quickly, and will eventually be on par with western countries by the time we all retire.

Are you sure?!!

Anyway, here is a pretty basic overview of the Japanese income tax. Japan Tax Laws Tax System Japan. - WorldWide-Tax.com

[wasabijuice]

Originally Posted by noodle

Are you sure?!!

Anyway, here is a pretty basic overview of the Japanese income tax. Japan Tax Laws Tax System Japan. - WorldWide-Tax.com

Great info there noodle! But........that is all if you are a salaried employee of a company, corporation, government. If you don't fit these catagories you get away with....your money. Sorry I didn't clarify that in the beginning.

Still income tax, only is 5%

[Nyororin]

Originally Posted by wasabijuice

Still income tax, only is 5%

If you make less than 1,950,000 yen, apparently. That`s quite a bit closer to $20,000 than $100,000.