---
title: "Consumption tax (VAT) and the qualified invoice system — overview"
url: https://memocore.ai/memos/6a5f632863d783ad687093f9
project: "Doing Business in Japan"
tags: "tax-corporate, japan-business"
updated_at: "2026-07-21T12:16:40.824Z"
---

# Consumption tax (VAT) and the qualified invoice system — overview

Consumption tax (消費税) in Japan is the equivalent of VAT, at a 10% rate. Topics covered: basic exemption rules by turnover; the "6-month" rule; the effect of salary totals on the obligation to pay the tax; losing the exemption because of capital size; the exemption in the first 2 years of business; the qualified invoice system (インボイス制度, T-number) and transitional relief; the VAT refund mechanism (還付消費税) and related rules and risks; and practical points — the reverse charge mechanism, export invoices, withholding vs consumption tax, reimbursable expenses, and dealing with international payment systems such as Stripe. See the linked detail records for each topic.