2026 POLLS: Restaurant Industry Leery of Zero Food Tax Pledges

Tokyo, Feb. 5 (Jiji Press)–Japan’s restaurant industry is worried about major political parties’ pledges of a zero consumption tax rate on food products ahead of Sunday’s House of Representatives election. These parties include the ruling Liberal Democratic Party and its coalition partner, the Japan Innovation Party, as well as the Centrist Reform Alliance, a new party formed by the Constitutional Democratic Party of Japan and Komeito, the LDP’s former coalition partner. If the consumption tax rate on takeout “bento” boxed meals and deli items falls to zero from the current 8 pct, more consumers could opt to avoid dining at restaurants, which is subject to the standard 10 pct tax rate. “Concerns that eating out will shrink are stronger than hopes that takeout and delivery will increase,” said an official of Colowide Co., which operates various restaurant businesses including the Ootoya set meal restaurant chain. Restaurant operators have already been struggling to manage their eat-in and takeout products since the lower tax rate on takeout products was introduced in October 2019. Some chains have set equal prices for eat-in and takeout customers to avoid confusion, but they may need to change this strategy if the takeout tax rate is reduced to zero. “Revising menus and updating cash registers would be a heavy burden,” an official of another major restaurant chain operator complained.Even an across-the-board tax rate cut would increase the administrative workload. A consumption tax cut is also expected to affect farmers. While those with annual sales of 10 million yen or less do not have to pay consumption tax to the government, they currently sell their products at tax-inclusive prices. If a zero tax rate on food products is implemented, however, they would no longer be able to use tax-inclusive prices. On the other hand, farmers would still have to pay 10 pct consumption taxes on agricultural machinery and fertilizers. END [Copyright The Jiji Press, Ltd.]