Threshold of Tax Credit Settled at a Minor Change
The Liberal Democratic Party (LDP) and Komeito concluded their idea on annual tax reform for FY 2025. On the review of threshold for imposing income tax, the leading coalition determined that it should be set at 1.23 million yen of annual income of each household, raising by 200 thousand yen from current level. It did not fulfill the demand of the Democratic Party for the People (DPP). Those three parties agreed on continuing their discussion on the issue next year. In the current system of income tax, every household are eligible for 480 thousand yen of basic tax credit. Another tax credit is applied to a salary worker, which is set at 550 thousand yen. The sum of both, 1.03 million yen, is deducted from the annual income of each salary worker, when the government calculates the amount for imposing income tax. If one has annual income less than 1.03 million yen, he or she will not have to pay for income tax. The DPP requested the leading coalition to raise the threshold from 1.0...