Japan strengthens steps to prevent resale of tax-free items

Japan is cracking down on a tax evasion scheme that involves resales of goods bought by non-resident foreigners.

Starting this month, residents who purchase tax-exempt items from visitors to the country can be held liable for paying the 10-percent consumption levy.

Non-resident foreigners need not pay sales tax if they take the items outside Japan.

But Finance Ministry officials say some tourists have acquired goods in bulk and diverted them to resale businesses in Japan for a fee.

The ministry officials say last fiscal year, customs demanded payments of 2.2 billion yen, or about 16.3 million dollars, from tourists who did not have the tax-exempt items they had purchased with them at ports of departure. But they were reportedly able to collect only 3 percent of that amount.

The officials say they hope that the crackdown will help prevent such tax avoidance.