LDP ponders tax breaks to spread 5G networks across Japan

Dec 10, 2019 | News On Japan

Dec 10, 2019 (Japan Times) - The Liberal Democratic Partyâ€™s tax panel is considering giving preferential tax treatment to mobile phone carriers and others to help spread fifth-generation, or 5G, high-speed wireless communications services.

The party is studying allowing the amount equivalent to 9 percent of related investment to be deducted from corporate tax or 30 percent of such spending from taxable corporate income in a program called special depreciation, Akira Amari, chairman of the Tax System Research Commission told reporters after a meeting Monday.

After consultations with its coalition partner, Komeito, the LDP will include the preferential treatment in a tax system reform package for fiscal 2020 to be compiled this week.

Initially, some called for allowing companies to deduct 30 percent of 5G-related investment from their corporate tax payments. But Amari suggested this proposal was not adopted on the grounds that mobile phone carriers have enough financial strength.

The preferential treatment is expected to cover business operators designated under new legislation to be created by the government with the aim of spreading 5G networks. Moving up schedules for current 5G projects is expected to be a condition for receiving the treatment.

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