ABSTRACT
This chapter briefly describes and evaluates the Japanese tax system. The next section is devoted to a short reminder of the Japanese economy and to an outline of the development of the Japanese tax system during the last decades. The Japanese fiscal burden has traditionally been modest compared with other G7 countries. The sizeable reductions in statutory marginal tax rates in both personal and corporate tax during the 1990s have strengthened this feature. Significant loopholes and non-neutralities are in place in key parts of the tax system, leading to potentially substantial efficiency losses.
