What's up with the value of the YEN?

[FG Lurker]

Totally agree here...way too many middlemen in the distribution here and the materials/goods are taxed again and again, each time they change owners.

This is a common misconception.

Businesses in Japan do not pay consumption tax, they only pay the difference between what they collect and what they have already paid out. It's only consumers that get screwed for consumption tax.

[gaijinpunch]

because you aren't paying production costs, you are paying the people that insert themselves into the process between you and the person producing the product.

That sounds like a production cost in and of itself.

[matsuki]

Totally agree here...way too many middlemen in the distribution here and the materials/goods are taxed again and again, each time they change owners.

This is a common misconception.

Businesses in Japan do not pay consumption tax, they only pay the difference between what they collect and what they have already paid out. It's only consumers that get screwed for consumption tax.

Misconception? I see it paid daily and have bazillions of invoices to show for it. If you got something I can shove in their faces to avoid paying it, by all means, please post it here. I should also mention the sales tax applies to the shipping costs as well, something I wasn't used to in the good ol US of A

[Samurai_Jerk]

Totally agree here...way too many middlemen in the distribution here and the materials/goods are taxed again and again, each time they change owners.

This is a common misconception.

Businesses in Japan do not pay consumption tax, they only pay the difference between what they collect and what they have already paid out. It's only consumers that get screwed for consumption tax.

Misconception? I see it paid daily and have bazillions of invoices to show for it. If you got something I can shove in their faces to avoid paying it, by all means, please post it here. I should also mention the sales tax applies to the shipping costs as well, something I wasn't used to in the good ol US of A

Yeah, the company I work for charges consumption tax on B2B transactions. Can you clarify, FGL?

[legion]

because you aren't paying production costs, you are paying the people that insert themselves into the process between you and the person producing the product.

That sounds like a production cost in and of itself.

if your definition of production is picking up a phone and doing "maru-nage" I guess so

[yanpa]

Totally agree here...way too many middlemen in the distribution here and the materials/goods are taxed again and again, each time they change owners.

This is a common misconception.

Businesses in Japan do not pay consumption tax, they only pay the difference between what they collect and what they have already paid out. It's only consumers that get screwed for consumption tax.

Misconception? I see it paid daily and have bazillions of invoices to show for it. If you got something I can shove in their faces to avoid paying it, by all means, please post it here. I should also mention the sales tax applies to the shipping costs as well, something I wasn't used to in the good ol US of A

Yeah, the company I work for charges consumption tax on B2B transactions. Can you clarify, FGL?

If it's like VAT in Europe, the B2B customers will be able to offset the 消費税 they're charged against the 消費税 they in turn charge their customers (who can be other businesses or end consumers). The point of VAT (Value Added Tax) is that it's a tax on each stage of the process, not a consumer tax. It used to do my head in when I was a contractor (though it was nice to be able to claim the VAT back on stuff not directly business related) and I'm glad I don't have to deal with it now.

[FG Lurker]

As a business, if you buy something from a supplier for 10,000yen you pay 500yen tax.

You then sell that on to another business (or a consumer) for 15,000yen and you collect 750yen tax.

Of that 750yen tax you pay the tax office 250yen as you already paid 500yen of it to your supplier.

So businesses pay the tax office the difference between the 消費税 they collect and all the 消費税 they have already paid to someone else.

I can't remember if businesses pay 消費税 on items they themselves consume or if this is taken into account when the calculation is made for how much of what they collect they have to pay to the tax office. It doesn't really matter either way though as any 消費税 a business paid for items consumed would just result in higher prices of the items they sell. In the end 消費税 is something paid only by end consumers.

[FG Lurker]

The point of VAT (Value Added Tax) is that it's a tax on each stage of the process, not a consumer tax. It used to do my head in when I was a contractor (though it was nice to be able to claim the VAT back on stuff not directly business related) and I'm glad I don't have to deal with it now.

VAT is designed to look like everyone pays a little bit along the way but in fact it's only consumers who actually pay VAT (including 消費税).

Every step along a supply chain has the VAT they pay offset by the VAT they collect. They pay nothing themselves as the person/business they sell to covers the VAT they already paid out. It's only the person at the very end of the chain who pays VAT and doesn't collect it from anyone else.

[FG Lurker]

Very happy to see the USDJPY closed over 103 for the week! The last time I saw the rate over 103 was October 7th 2008.

Next stop, 105, not seen in my system since Oct 4th 2008, and hopefully followed by 110, not seen since Aug 21st 2008!

[Samurai_Jerk]

As a business, if you buy something from a supplier for 10,000yen you pay 500yen tax.

You then sell that on to another business (or a consumer) for 15,000yen and you collect 750yen tax.

Of that 750yen tax you pay the tax office 250yen as you already paid 500yen of it to your supplier.

So businesses pay the tax office the difference between the 消費税 they collect and all the 消費税 they have already paid to someone else.

I can't remember if businesses pay 消費税 on items they themselves consume or if this is taken into account when the calculation is made for how much of what they collect they have to pay to the tax office. It doesn't really matter either way though as any 消費税 a business paid for items consumed would just result in higher prices of the items they sell. In the end 消費税 is something paid only by end consumers.

How does that work for B2B services?

[wagyl]

As a business, if you buy something from a supplier for 10,000yen you pay 500yen tax.

You then sell that on to another business (or a consumer) for 15,000yen and you collect 750yen tax.

Of that 750yen tax you pay the tax office 250yen as you already paid 500yen of it to your supplier.

So businesses pay the tax office the difference between the 消費税 they collect and all the 消費税 they have already paid to someone else.

I can't remember if businesses pay 消費税 on items they themselves consume or if this is taken into account when the calculation is made for how much of what they collect they have to pay to the tax office. It doesn't really matter either way though as any 消費税 a business paid for items consumed would just result in higher prices of the items they sell. In the end 消費税 is something paid only by end consumers.

How does that work for B2B services?

This example is no different for B2B than for any other. In brief, those who have an obligation to pay consumption tax on their sales, can deduct from the amount they are obliged to pay any consumption tax they have themselves paid to their suppliers. Unless automated, this is a huge accounting cost on the tax payer, potentially more than the tax they save, and I suspect the tax authorities hope that you will not do those calculations.

[FG Lurker]

Companies that have less than 50mil yen per years in sales do not have to pay sales tax to the tax office. Any company with more than 50mil yen a year in sales shouldn't have any problem managing the accounting.

[Yokohammer]

Companies that have less than 50mil yen per years in sales do not have to pay sales tax to the tax office. Any company with more than 50mil yen a year in sales shouldn't have any problem managing the accounting.

You sure about that?
I have to pay sales tax when my yearly sales exceed 10 million.

[wagyl]

Companies that have less than 50mil yen per years in sales do not have to pay sales tax to the tax office. Any company with more than 50mil yen a year in sales shouldn't have any problem managing the accounting.

You sure about that?
I have to pay sales tax when my yearly sales exceed 10 million.

A previous time this issue came up, it was 10 million yen (includes link to tax agency site).

[wagyl]

Companies that have less than 50mil yen per years in sales do not have to pay sales tax to the tax office. Any company with more than 50mil yen a year in sales shouldn't have any problem managing the accounting.

You are of course correct (about capacity to make the calculation if not about the sales figures), it is just a bee I have buzzing around in my bonnet about how, compared to the amount of revenue a consumption tax of 5% brings in to the coffers, the costs of calculating that tax are disproportionately large and burdensome on the taxpayer. Adam Smith would not approve.

[FG Lurker]

Companies that have less than 50mil yen per years in sales do not have to pay sales tax to the tax office. Any company with more than 50mil yen a year in sales shouldn't have any problem managing the accounting.

You sure about that?
I have to pay sales tax when my yearly sales exceed 10 million.

Interesting. I think it used to be 50mil so I guess it changed. (Or maybe I'm just out to lunch -- 50/50 odds really.)

[FG Lurker]

You are of course correct (about capacity to make the calculation if not about the sales figures), it is just a bee I have buzzing around in my bonnet about how, compared to the amount of revenue a consumption tax of 5% brings in to the coffers, the costs of calculating that tax are disproportionately large and burdensome on the taxpayer. Adam Smith would not approve.

For me it's not a big deal. Everything bought or sold gets entered into the accounting software and sent to the accountant monthly. He takes care of the quarterly filings. His fees are reasonable and he does a great job. One less thing for me to worry about.

[matsuki]

If that's true, i'm pretty sure the company I work for is paying a ton of unnecessary tax...

[Samurai_Jerk]

Endaka's baaaaaaaaaack ....

Japan's Nikkei Dives as Yen Gains Strength

Japan's stock market dived Monday after the yen reversed some of its recent fall against the U.S. dollar. Stocks elsewhere in Asia were mixed as investors tried to sort out conflicting indicators about the health of the global economy.

The Nikkei 225 shed 2.6 percent to 14,238.72, after its stalwart export sector was hit with wide-ranging losses. The benchmark in Tokyo has been on a tear, rising 36 percent since the beginning of the year. The yen's steady fall against other major currencies has been a major market propellant but it reversed some of that decline Monday after reaching 103 to the dollar last week.

Looks like it's currently just below 101 to the dollar.

[matsuki]

http://www.bloomberg.com/video/sexism-s ... 0EBJg.html

Who is this dude that's not drinking the green tea kool-aid?

[Samurai_Jerk]

http://www.bloomberg.com/video/sexism-stands-in-way-of-abenomics-saving-japan-j64Z5XtDQGuLmF_510EBJg.html

Who is this dude that's not drinking the green tea kool-aid?

This guy ain't saying anything new. I've heard plenty of commentators make the same points over the years.

I have to disagree with him that they aren't properly utilizing the female workforce though what with all the deli-healths, massage parlors, and oppai pubs. I can't think of a better way to use them.

[Samurai_Jerk]

Dollar-Yen at 89? It Could Happen by Year-End

Clifford Bennett, chief economist at financial services firm White Crane Group, forecasts the dollar-yen to weaken about 11 percent from current levels until the end of 2013.

"The dollar-yen was the most overbought market of any market in the world last week and it has a lot of unwinding to do just to get back to neutral on some highly speculative positions," Bennett told CNBC Asia's "Squawk Box." "Remember where the dollar-yen is coming from. It has been on a huge rally and so down to 89 is really a volatile pullback."

[matsuki]

I have to disagree with him that they aren't properly utilizing the female workforce though what with all the deli-healths, massage parlors, and oppai pubs. I can't think of a better way to use them.

High school drop outs making it I tell yah!!

[MrUltimateGaijin]

[gaijinpunch]

Dollar-Yen at 89? It Could Happen by Year-End

Clifford Bennett, chief economist at financial services firm White Crane Group, forecasts the dollar-yen to weaken about 11 percent from current levels until the end of 2013.

"The dollar-yen was the most overbought market of any market in the world last week and it has a lot of unwinding to do just to get back to neutral on some highly speculative positions," Bennett told CNBC Asia's "Squawk Box." "Remember where the dollar-yen is coming from. It has been on a huge rally and so down to 89 is really a volatile pullback."

I hope this guy is as correct as every single other economist on the fucking planet was from 2009 to late 2012.

[Samurai_Jerk]

It looks like we're below 100 today.

[matsuki]

Limbo limbo limbo!

[MrUltimateGaijin]

gogogo

[IparryU]

gogogo

fuck... i want a higher rate...

[IparryU]

Break out the Violin and porter potty or Abe...

http://www.zerohedge.com/news/2013-06-0 ... ear-market