Business · Companies · 6 hrs ago
Japan restaurants weigh takeout investment ahead of food tax cut
Japan plans to cut the tax on food to 1% from April 2027, while the tax on eating in restaurants will remain 10%.
The cut is planned to last two years.
That difference is prompting restaurant companies to consider expanding takeout, which will qualify for the lower rate.
Hidakaya is considering takeout-only shops, but its operator says it cannot tell whether the investment costs would be recovered.
Companies are cautious because takeout businesses expanded during the COVID-19 boom, then many withdrew.
The challenge is deciding whether a temporary tax advantage will bring enough business to justify the investment.
Restaurant companies are still considering their plans, and the sources give no decision or next step.
Japan’s restaurant companies are considering expanding takeout businesses ahead of a planned food tax cut.
The government has decided to lower the consumption tax on food to 1% from April 2027.
The tax on dining in at restaurants will remain at 10%, making takeout eligible for the reduction.
Companies say it may be difficult to recover investment costs during the two-year tax-cut period.
Hiday Hidaka, operator of the Hidakaya Chinese restaurant chain, is considering takeout-only outlets but says the investment outlook is uncertain.
- Who
- Japanese restaurant companies, including Hiday Hidaka, which operates the Hidakaya chain.
- What
- They are considering investing in takeout businesses ahead of a food tax cut.
- When
- The cut is planned to begin in April 2027 and last two years.
- Where
- Japan.
- Why
- Takeout food will qualify for a lower tax rate, while dining in will remain taxed at 10%; companies are uncertain they can recover investment costs during the cut.
This story does not have two clearly opposing sides.
Nikkei reported that restaurant companies were considering strengthening takeout businesses ahead of the food tax cut.
The planned reduction of the consumption tax on food to 1% is set to begin.
- Food tax rate
- 1% from April 2027
- Dining-in tax rate
- 10%
- Tax-cut period
- Two years
- Hiday Hidaka operator
- Hiday Hidaka
- Restaurant chain
- Hidakaya
1 source
What people are saying
We are considering opening takeout-only outlets, but cannot see whether we can recover the investment costs.