Discussion Papers 2022
CIRJE-F-1204 | "Cross-Border Shopping, E-Commerce, and Consumption Tax Revenues in Japan" |
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Author Name | Adachi, Yoshimi and Hikaru Ogawa |
Date | November 2022 |
Full Paper | PDF file |
Remarks | Revised in January 2024 |
Abstract |
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This study estimates the impact of cross-border consumption and e-commerce on local consumption tax revenues for Japanese municipalities. Descriptive statistics reveal that, in 2019, expenditure through e-commerce accounts for 2.5% of household consumption expenditures, 9.1% in other municipalities in the same prefecture, and 6.1% in other prefectures, all of which are higher than the values five years ago. The main findings obtained from the panel data analysis are as follows: First, local consumption tax revenue per capita is significantly lower by approximately 0.3% in municipalities with 10% more consumption spending outside the municipalities. Second, the revision of rules for allocating consumption tax revenues in 2018 has the effect of favoring municipalities facing a consumption drain with a large population but low in-store sales. |
Keywords: Cross-border shopping, E-commerce, Local consumption tax |