The government approved a Cabinet decision on a proposal to revise consumption tax rates from April 2027. The rate for food products will be 1%, while the 10% rate for dining on the premises will remain unchanged. An association survey showed that 58% are concerned about a decline in the number of customers dining out.
The government approved a Cabinet decision on a proposal to reduce the consumption tax rate on food products to 1% while leaving the current 10% rate for dining on the premises unchanged. Three organisations held a joint press conference, citing concerns about customers staying away from restaurants and the impact on store operations.
The Japan Food Service Association surveyed 410 member companies and published responses from 204 of them. It said that 57.8% of companies expect the number of customers dining out to decline after the tax rate on food products is reduced. A total of 21.1% expect average spending per customer to fall, 31.9% expect no impact, and 36.8% said they did not know.
The association is also concerned that companies may be forced to lower product prices to avoid a decline in customer numbers. The impact is expected to be greater in business formats with a high proportion of sales from dining on the premises and in those with average spending per customer of around ¥1,000, with small and medium-sized companies expected to be particularly affected.
Some companies are concerned about the cost of system modifications and the additional workload while the preparation period before the system starts remains limited. The association views the impact of the tax rate difference on consumer sentiment as significant and plans to continue analysing the data and making requests to the government.