Japan to Face Major Changes to Adopt Global Tax Pact

Japan will this year have to enact the most sweeping changes to its tax law since World War II if it is to implement the global tax overhaul for 2023, officials, tax experts, and industry analysts say.

The biggest challenge relates to a 15% global minimum corporate tax, which may require the introduction of a “top-up” levy. That would allow Tokyo to collect the difference in taxes between what it currently receives from Japanese companies with overseas subsidiaries and what they pay in countries—such as Ireland and Hungary—where the corporate rate is currently below 15%.

Key officials are coordinating with ...