Shopping in Osaka: Tax-Free Shopping and VAT Refund
With each country having its own requirements and guidelines for receiving VAT refund, it could be confusing and daunting to shop tax-free while traveling. Japan, fortunately, has made it very easy for visitors to shop tax-free. In Japan, 8% consumption tax is applied to all products/items. Depending on the store, you may receive anywhere from 6.8 to 8% VAT refund or tax-free shopping. Read on to find out how to qualify for tax-free shopping in Osaka.
Eligibility for tax-free or VAT refund shopping:
- Foreign visitors (with a foreign passport other than Japanese passport) whose stay in Japan is less than 6 months
- Foreign visitors with a valid entry stamp on their passport, which means they must see an immigration officer upon entering Japan
- Purchase must be over ¥5,000 prior to taxes or ¥5,400 including taxes made on the same day at the same place.
- Your purchase must remain unused in its new condition until you leave Japan.
- The purchase must fall under either general items or consumable items, and the purchase must be over ¥5,000 for each category, not combined. There is no maximum limit for general items, however, consumable items have to be less than ¥500,000 per shop per day to qualify for tax-free shopping. See the chart below to find out what falls under each category.
|General Items||Consumable Items|
|Bags||Health food products|
For instance, let’s say you purchase a sweater for ¥3,000 and a pair of pants for ¥2,500 at the same store on the same day. You qualify for tax-free shopping or VAT refund if the store participates in the program. Also, let’s say you purchase a bottle of sake for ¥3,500 and snacks for ¥2,000 at the same market. You would qualify for tax-free shopping if the market participates in the program. Let’s also say that you purchase a pair of shoes for ¥3,500 and cosmetics for ¥2,500 at the same store. Unfortunately, you would not qualify for tax-free shopping as your purchase is from two different categories and do not total ¥5,000 in each category.
- General items must be taken out of Japan within 6 months of date of entry into Japan, while consumable items must be taken out of Japan within 30 days of purchase.
- The store where you make your purchase must participate in the tax-free shopping program. Usually, there are signs throughout and outside the store that indicate that they offer tax-free shopping. You can also look for a sign like this:
How to shop tax-free or receive VAT refund:
- Make sure you and your purchases are eligible for tax-free shopping by checking the eligibility list above.
- Take your passport with you when shopping. Photos, paper copies, etc., are not accepted. And as always, be vigilant and keep your passport and important documents in a safe place on you when you are out shopping with them.
- Following the guidelines above, make your purchase. There may be a separate line for tax-free shopping. In the case that there isn’t one, let the cashier know that you are a foreigner and wish to receive the tax refund or shop tax-free.
- Show your passport and fill out necessary paperwork.
- Depending on the store, you may have two options: 1) you will be charged the amount pre-taxes (without the 8% tax), which is what I prefer as it is simpler and straight-forward; 2) after paying for your purchase that includes taxes, you must stand in a separate line to receive your VAT refund.
- The cashier will staple the receipt and document to your passport. Don’t detach them until you leave Japan and have to hand over the paperwork to the customs officer at the airport.
- Store clerk will package your items in a special bag and seal it, which must remain unopened and unused during your stay in Japan. If customs somehow find out that you had used your tax-free item, you will owe taxes on it.
- According to online sources, you are to turn in your VAT refund documents to customs upon leaving Japan.
- Note that in certain department stores where there are different brands and shops, you may be able to receive a VAT refund by combining the receipts to total over ¥5,000 (pre-taxes). Check with the department store’s customer service to see if they offer that program and find out which shops participate.
Check out these sites for more information: