Japan’s Cabinet has approved a tax reform plan for the next fiscal year and includes a move to cut the corporate tax rate to 25% for companies that raise their employees’ wages by 3%. For companies investing in improving their productivity or digitization, a further reduction to 20% is likely.
Most of the changes in the reform plans were first announced in a tax reform package approved by the ruling Liberal Democratic Party on 14 December 2017. The government hopes that the law will come into effect from the next fiscal year starting in April 2018.
