Japan METI Supports Steel Industry by Tax Treatment

Ministry of Economy, Trade & Industry (METI) of Japan supports Japanese steel industry by tax measures from fiscal 2009 starting April. METI frees automobile weight tax and automobile acquisition tax to boost automobile sales while promotes investment of energy saving equipment by another tax treatment. The ministry encourages introduction of high efficient heat furnaces and the new generation cokes production process, SCOPE21 by tax treatment. METI also carries out financial assistance by low-interest loan or policy finance. The ministry will encourage housing investment by home buyers’ tax break.

As for petroleum and coal tax, METI extends the existent measures for additional 2 years. These measures could bring tax reduction effect at about 50 billion yen.

Moreover, METI carries out international tax treatment for profits of overseas subsidiary. It doesn’t count cash dividend of overseas subsidiaries in domestic gross revenue. The ministry cuts off double taxation. Japanese company can return overseas profit to Japan.

On the other hand, METI announced on Tuesday to introduce sectoral benchmark for steel industry when the Rationalization in Energy Use Law is revised from fiscal 2010. The law system changes to company-to-company basis from plant-to-plant basis. The ministry aims visualization of energy saving assessment. Japanese steel industry should decrease gross energy use against the production of crude steel.