Introduces 'Super' tax incentives for large-scale investment in Regional Revitalization Areas
01 Apr 2025
On 31 March 2025, Japan enacted the 2025 Tax Reform Act, introducing a “super tax” regime to strengthen tax incentives for large-scale investment in designated Regional Revitalization Areas outside major cities such as Tokyo and Osaka.
Under the existing framework, companies making investment of at least JPY (Japanese Yen) 100 million (approximately $0.67 million) in eligible areas could apply an immediate depreciation of 35 per cent of the acquisition value of qualifying facilities.
In addition to the existing incentive, the new regime applies to investments of JPY 1 billion (approximately $6.7 million) or more and allows eligible enterprises to choose between a special depreciation of 50 per cent of the acquisition cost or a tax credit of 5 per cent against corporate income tax. The measure applies from fiscal years 2025/26 and applies to projects approved by 31 March 2028.
Nature of measure:
Type:
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Promotion and facilitation (Investment incentives)
Industry:
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Not industry specific
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Manufacturing (Manufacture of chemicals and chemical products, Manufacture of basic metals, Manufacture of fabricated metal products, except machinery and equipment, Manufacture of computer, electronic and optical products, and electrical equipment, Manufacture of machinery and equipment n.e.c., Manufacture of transport equipment)
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Services (Electricity, gas, steam and air conditioning supply, Transportation and storage)
Inward FDI:
Yes
Outward FDI:
No
Sources:
