Outline for Tax System Reform: Put Japan’s Economy on New Growth Path by Promoting Investment |
Editorial
16:04 JST, December 21, 2025
The Japanese economy now stands at a turning point to attract aggressive investment from companies and chart a new path for growth. It is hoped that motivated companies will be supported through the tax system.
The Liberal Democratic Party and the Japan Innovation Party have decided on the outline of the ruling coalition’s tax system reforms for fiscal 2026. The parties have drawn up measures prioritizing growth aimed at realizing the “robust economy” sought by the administration of Prime Minister Sanae Takaichi.
The outline calls for establishing a system that will allow companies in all industries to deduct 7% of their capital investments from their corporate tax. For cutting-edge fields designated as national strategic technologies such as semiconductors, it also envisages the introduction of a scheme to deduct up to 40% of research and development expenses........