Japan’s ruling parties have agreed to exempt delivery and take-out foods as well as newspapers sold on a subscription basis from the consumption tax hike in April 2017, coalition members said Tuesday.
The Liberal Democratic Party and Komeito party had already agreed to designate all food products except at restaurants as subject to a lower consumption tax rate when the government raises the rate to 10%.
Fresh and processed foods, and beverages, excluding alcoholic drinks, will be exempt from the sales tax hike to ease the burden on consumers. Ruling parties were studying on how to draw a line between processed foods and foods served at restaurants.
Excluding fresh and processed foods from the tax hike from the current 8% would reduce state revenues by some 1 trillion yen ($8.27 billion) annually, forcing the government to find other sources to cover the loss.
According to their plan, dishes served at places with such facilities as tables and chairs will be considered restaurant food, the members said.
The plan, which will be included in tax reform policies for fiscal 2016, will be formally adopted by the ruling parties on Wednesday.
The tax rate for take-out foods bought at fast food restaurants as well as bento box lunches and prepared foods purchased and consumed at convenience stores will remain at 8%.
Meanwhile, foods served with plates or utensils that need to be returned to restaurants located in such places as shopping mall food courts will not be exempt from the sales tax hike.
Catering services to provide and set out food and drinks at events will also be categorized with restaurant food.