経財相「人材誘致へ所得税軽減」　金融ハブフォーラム

Income tax reduction to attract human resources

Yasutoshi Nishimura, Minister of Economy, Finance, and Rehabilitation, gave a lecture on "International Financial Hub and the Role of Japan" held by Nihon Keizai Shimbun in Tokyo on the morning of the 2nd. He explained that the government is considering reducing the income tax burden in order to attract overseas asset management companies and highly-skilled financial personnel to Japan, and said, "We will recognize a certain range of investment results as financial income." The policy is to include it in the 2021 tax reform outline that will be summarized this month.

The Yoshihide Suga administration has set up an "international financial city concept" to create a global financial hub in Japan. Like Hong Kong, the financial center of Asia is shaken by political instability, Japan aims to receive bases and human resources. Nikkei Inc. held a special project on the theme of the financial hub as part of the "Nikkei Virtual Global Forum" to hear opinions from domestic and foreign experts.

Mr. Nishimura pointed out that "Japan has assets and a stable living environment and has the potential to become an international financial hub, but it has not been fully utilized." He said, "We will create an environment where foreigners can live comfortably and simplify procedures," and expressed his intention to incorporate the necessary measures into the economic measures being formulated.

In the income taxation of fund managers who manage financial assets, it has not been clear until now whether or not the income earned from a partial investment in a fund is financial income. The government and the ruling party are planning to show a new way of thinking about applying a tax rate of 20% as financial income in the tax reform outline for FY2009.

When considered business income, there is an income tax of up to 55%. By clarifying the interpretation of financial income and avoiding the situation where high tax rates are applied, we will attract highly-skilled overseas personnel.

Mayor William Russell of London's financial district City sent a video message. "The development of Tokyo as an international financial hub will bring benefits to the UK as well," he promised full cooperation. He added, "Japan is already improving its tax system, language barrier, visas, etc. in order to regain its position as a financial city."

Green investment and fintech were mentioned as specific areas of cooperation between Japan and the UK. Regarding green investment, the UK just announced in November that it would require companies to disclose information about the financial and business impacts of climate change. "Sustainability is also a high priority issue for Japan," Mayor Russell called for cooperation.

Source: https://www.nikkei.com/article/DGXMZO66892960S0A201C2MM0000/