Japan to Expand Tax Break for Firms Moving Out of Tokyo

Newsfrom Japan

Economy

Aug 27, 2025 17:40 (JST)

Tokyo, Aug. 27 (Jiji Press)–The Japanese government plans to expand a tax break program designed to encourage more companies to relocate their headquarters functions from Tokyo’s 23 special wards to local areas, informed sources said Wednesday.

Specifically, the government aims to extend the tax break’s deadline, which is currently scheduled to run to the end of March 2026, and raise the corporate tax reduction rate.

The Cabinet Office plans to include the expansion in its tax system reform requests for fiscal 2026.

Under the program, if companies relocate their headquarters functions from Tokyo’s 23 special wards to local areas, they can receive a tax cut equivalent to 7 pct of the cost of obtaining an office building.

If companies expand their existing headquarters functions outside Tokyo, they can receive a tax credit equivalent to 4 pct of the cost of acquiring a building.

[Copyright The Jiji Press, Ltd.]

Jiji Press