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The Ministry of Internal Affairs of Japan should approve the proposal of the authorities of the city of Kyoto to tax the owners of empty and country houses, an informed source said. The city will be the first in the country to implement this system.
Details. The new tax, which should be introduced no earlier than 2026, is aimed at stimulating the real estate market amid an outflow of young people trying to find housing in Kyoto. If successful, it can serve as a reference point for other cities facing similar problems.
In addition to unoccupied real estate, the tax will also apply to holiday homes and unoccupied secondary residential buildings, while factors such as the value and location of the property are taken into account when calculating the amount subject to taxation.
Calculations. The addition of this tax is expected to increase the tax burden on owners by about 50%. Inexpensive real estate and traditional townhouses popular among foreign tourists will be exempt from this fee.
Examples. Kyoto municipal authorities estimate that the tax on an empty 40-year-old apartment of 60 square meters, which is difficult to sell, will be about 24,000 yen ($181) per year.
Meanwhile, a five-year condominium on the top floor of a 100-square-meter central multistory building that is used as a vacation home several times a year will attract an annual tax bill of approximately 939,000 yen ($7,160).
Context. According to the city authorities, there are about 15,000 unoccupied residential buildings in Kyoto. The historic city has strict building regulations in place to preserve the landscape, which leads to a shortage of supply and the departure of young residents of the city, many of whom cannot find housing due to soaring prices.
Source: Japan Times
Photo by Cosmin Georgian on Unsplash
