December 17, 2003
Tax reform for FY 2004 was finalized on December 17, 2003. Major items pertinent to the Ministry of the Environment are presented below:
<Global Warming Prevention Measures and Atmospheric Environment Conservation Measures>
Tax measures to promote popularization of low-emission and fuel-efficient vehicles include:
- Greening of the automobile tax to be continued for two more years.
- Expansion of tax reduction measures pertaining to the automobile acquisition tax covering purchases of vehicles that meet the NOx emission standard to replace ones in possession within the areas specified under the Automobile NOx/PM Law.
Vehicles complying with the 2005 emission standards are added to the list of vehicles eligible for the tax break, and tax reduction rate is raised.
- Expansion of tax reduction measures pertaining to the acquisition of vehicles that meet the latest motor vehicle exhaust emission standards.
Diesel-powered motor vehicles complying with the 2005 emission standards are added to the list of vehicles eligible for the tax break, and the tax reduction rate is raised.
- Two-year term extension of the application of the preferential measure covering the automobile acquisition tax base, which sets the base of taxation at ¥300,000 less than the acquisition price for fuel-efficient vehicles achieving a certain level of exhaust gas emissions.
- Extended term of application and expansion of the special depreciation system or special tax deduction for low-emission vehicles and facilities supplying fuel to low-emission vehicles under the taxation system for stimulating investment to promote structural reform in the supply and demand of energy.Fuel-cell vehicles and hydrogen refueling stations are added to the list of vehicles and facilities eligible for the measures.
<Waste Management and Recycling Measures Aiming at the Creation of a Sound Material-Cycle Society>
In order to promote upgrading of recycling facilities, the application term of the special depreciation system for recycling facilities is extended. Also, the preferential measure on the fixed property tax base is expanded to make construction sludge recycling equipment eligible.
Expansion is made to the preferential measure on the business office tax base (fixed property) levied on facilities made available for business use by operators who are certified by the Minister of the Environment to engage in cross-jurisdictional waste treatment operations under the Waste Management and Public Cleansing Law.
<Comprehensive Promotion of Biodiversity Conservation and Coexistence with Nature>
Tax measures taken to promote wildlife protection and management include:
- Creation of an earmarked tax, a "game hunting tax (a provisional name)," which consolidates the existing hunter registration tax and hunting tax.
- Introduction of a measure to exempt hunters holding the Class I game shooting license from the "game hunting tax (a provisional name)," if they use an air gun.
<Matters to be Discussed>
It was agreed that comprehensive deliberations should be made on the taxation system related to global warming prevention measures, as well as on other economic instruments. Such deliberations shall be based on the nation-wide discussion and give careful consideration to the effects on the entire spectrum of the nation's economy and industry, while giving thought to the assessment and review of the Climate Change Policy Programme.