Kyoto may be first city in Japan to introduce a tax on empty homes

Kyoto City is looking at introducing a special tax on vacant ‘akiya’ homes, in what could become the first akiya tax in Japan.

There are over 100,000 empty homes in Kyoto City, but they’re not all available to purchase. They may have owners who don’t want to sell, owners who use them occasionally, owners who are in disagreement about what to do with their homes, and so on. There are currently less than 2,000 detached homes on the market for sale in Kyoto, a city with a population of around 1.4 ~ 1.5 million. The city hopes that imposing an additional tax burden on these homeowners will at least convince some to sell and loosen up supply in a tightly-held market. 

The homes the city is most concerned about are those that have fallen into complete disrepair. Such homes can be a fire hazard or can pose a risk to passers-by in the event that they collapse. Loose roof tiles and sheeting can be a projectile hazard in the event of a typhoon.

How much will the tax be?

The taxes will be based on the government valuations of the building and land. The current proposal is for the tax rate to be 0.7% of the fixed asset tax value of the building, and 0.3% of the fixed asset value of the land on a per-square-meter basis multiplied by the building size.

An example provided is for a 20-year old house in Yamashina ward with a total floor size of 100 sqm. It can expect an additional akiya tax of 50,000 Yen a year.

This tax will apply to empty apartments, too. A 5-year old, 100 sqm apartment in the more expensive Nakagyo ward could see an akiya tax of as much as 520,000 Yen a year.

Exceptions may be granted to certified traditional machiya townhouses and buildings with heritage registration, as well as ordinary homes and apartments that are currently empty due to being advertised for rent or sale (unless they have been on the market for over 1 year). There may also be deductions for homeowners that are on temporary job transfers.

The date for introducing this tax has yet to be decided. The annual tax revenue from these two additional taxes is expected to be around 800 ~ 900 million Yen. 

Sources:
Kyoto City Homepage, December 7, 2021.
The Kyoto Shimbun, January 12, 2022.
MBS News, January 19, 2022.

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