Japan is reportedly considering a significant revision to its de minimis customs regime, aligning with global trends. The proposed changes aim to address the rapid growth of cross-border e-commerce shipments that currently benefit from duty and tax exemptions under the existing de minimis rules.
1. Current Framework
Under Japan’s current system, imported goods valued below JPY 10,000 (approximately USD 60) are exempt from customs duties and consumption tax. This threshold was originally intended to simplify customs clearance for low-value shipments. However, the volume of such parcels has surged dramatically in recent years, driven largely by overseas e-commerce platforms.
According to recent data from Japan’s Ministry of Finance, the number of low-value imports have increased tenfold over the past eight years (2016 and 2024), reaching over a hundred million parcels annually. This trend has raised concerns about tax revenue loss and competitive disadvantages for domestic retailers.
In October 2025, new fields were introduced in Japanese import declarations, including (i) the name and destination of the location, (ii) confirmation of whether the cargo qualifies as e-commerce goods, and (iii) the name of the platform used for the transaction. These updates show that changes are already taking place to address this trend.
2. Interim Report
The Customs and Tariff Bureau of the Ministry of Finance has established a working group to review systems and operations in response to the rapid increase in low-value import cargo, driven by the expansion of cross-border e-commerce. The working group released an Interim Report on 21 November 2025, outlining several possible directions for reform. The report confirms that both the consumption tax and customs duty exemptions, including the following four systems, for low-value imports are under active review.
- Low Value Duty Exemption System for Customs Duties1 (JPY 10,000 or less)
- Low Value Duty Exemption System for Consumption Tax2 (JPY 10,000 or less)
- Special Provision for Determining Taxable Price (0.6 times rule)3 for individual import
- Simplified Customs Duty Rate for Low Value Imported Goods4 (JPY 200,000 or less)
The possible directions for the reform have been summarized below:
- As for the Low Value Duty Exemption System for Consumption Tax, the group is considering to refer to international models, such as those in the EU and Australia, where foreign sellers and platforms must register for tax purposes and collect VAT or GST at the point of sale. However, the group notes the practical challenges in customs clearance procedures, as low-value cargo purchased through platforms or e-commerce sites could be taxed in two different ways, either at the time of sale or at the time of import declaration.
- As for the Low Value Duty Exemption System for Customs Duties, the working group is considering to either eliminate the system entirely or to lower the de minimis threshold. This stems from concerns that the system generates competitive unfairness between domestic and foreign businesses and encourages practices such as undervaluing cargo to JPY 10,000 or less to avoid duties. However, the group concludes that such changes could hinder expedited customs clearance and reduce convenience for importers.
- In light of the above-mentioned issues, the group instead considers to reevaluate the Simplified Customs Duty Rate for Low Value Imported Goods, by reviewing the tariff levels based on current EPA rates and the in-scope items of the system, taking into account the potential impact on domestic industries.
- As for the Special Provision for Determining Taxable Price (0.6 times rule), the group is considering abolishing the system completely, as its original purpose has either disappeared or evolved, and issues such as market distortion and misuse have become evident. The working group acknowledges the administrative challenges that reform may pose, especially for customs brokers, logistics providers, and importers. If all low-value shipments become taxable, there will be a need for a transition period and upgrades to customs systems to manage new compliance requirements. Public communication will be essential to help consumers and businesses understand the changes.
Japan’s move would align with a broader international trend: the EU has announced plans to abolish its EUR 150 de minimis threshold by 2026, introducing transitional measures and a centralized data platform by 2028, while the United States recently suspended its USD 800 exemption for commercial shipments. These developments underscore a global effort to close loopholes, protect tax revenues, and create a level playing field for domestic businesses.
3. Practical Implications
Foreign e-commerce sellers should begin assessing potential registration obligations and updating compliance strategies to avoid disruption. Logistics providers and customs brokers should review clearance processes and train staff to ensure readiness for new compliance requirements, as these reforms could significantly alter import procedures.
- Based on the Customs Tariff Act, imported goods with a total taxable value of JPY 10,000 or less are exempted from customs duties. Certain items are excluded from this exemption. ↩︎
- Based on the Customs Duty Collection Act, imported goods with a total taxable value of JPY 10,000 or less are exempted from consumption tax. Certain items are excluded from this exemption. ↩︎
- Based on the Customs Tariff Act and the Consumption Tax Act, the taxable value of goods for personal use is calculated as overseas retail price × 0.6. ↩︎
- Based on the Customs Tariff Act, imported goods with a total taxable value of JPY 200,000 or less are, in principle, subject to seven tiers of decreased customs duty rate. Certain items are excluded from this application. ↩︎
