Japan Corporate and Tax Quarterly Update: 2023 July Issue

In this issue, we focus on the FY2023 Tax Reform Enforcement Order and Enforcement Regulations and the Guidelines on Respecting Human Rights in Responsible Supply Chains.

On the tax side, the Cabinet Order Partially Amending the Order for Enforcement of the Income Tax Act (“Cabinet Order”) and the Ministerial Order Partially Amending the Ordinance for Enforcement of the Income Tax Act in relation to the 2023 Tax Reforms (“Ministerial Order”) were published in a special extra (No. 25) of the Official Gazette dated March 31, 2023.

On the corporate side, in April 2023, the Ministry of Economy, Trade and Industry of Japan published the “Reference Material on Practical Approaches Enabling Business Enterprises to Respect Human Rights in Responsible Supply Chains” (the “Reference Material”). The Reference Material provides in-depth explanations and examples of considerations and steps that business enterprises may undertake, including “formulating a human rights policy” and “identifying and assessing adverse impacts on human rights.”