The Current System: Instant Savings
For years, travellers from India and around the world have enjoyed a straightforward tax-free process in Japan. If you spend over ¥5,000 in a single store on the same day, you can get an instant exemption from Japan's 10% consumption tax. You simply show
your passport with its 'Temporary Visitor' stamp, and the shop either deducts the tax at the checkout or refunds it at a dedicated counter in-store. For 'consumable' items like food and cosmetics, staff place your goods in a special sealed bag, which you are not supposed to open until you have left Japan.
What's Changing from November 2026?
From November 1, 2026, the instant discount model will be history. The system will switch to a 'refund method' common in many European countries. This means all visitors will pay the full, tax-inclusive price for goods at the time of purchase. You will then need to claim the 10% consumption tax back before you depart Japan. The core reason for this change is to prevent abuse of the system, where tax-free goods were being illegally resold within Japan without the tax ever being paid.
How the New Refund Process Will Work
When you buy goods, you'll pay the full price. The shop will provide information, possibly via a QR code, for you to register your purchase and choose a refund method, such as your credit card. Then, at the airport before your flight, you must complete an export confirmation process at a customs kiosk. You’ll scan your passport, and a screen will tell you if your goods need a physical inspection (a 'Red Result') or if you can proceed (a 'Green Result'). You must do this before checking your luggage, as customs may need to see the items. Once confirmed, your refund will be processed to your chosen method.
Key Rules and Simplifications
While the process is changing, some things are getting simpler. The good news is that the distinction between 'general goods' (like electronics) and 'consumables' (like cosmetics) will be abolished. This means you can combine all your purchases from one store to meet the ¥5,000 minimum spend. The need for special sealed bags will also be eliminated, as will the ¥500,000 cap on consumables. However, the basic rule remains: the goods are for export, so you shouldn't use up your tax-free snacks or cosmetics before you leave the country. You will have 90 days from the date of purchase to take the items out of Japan.
Planning Your Trip from India
What does this mean for Indian travellers planning their next Japanese holiday? The biggest impact will be on your budget and your airport routine. You'll need to have enough funds on your credit card or in your bank account to cover the full, tax-inclusive price of your shopping upfront. The 10% you used to save instantly will now be tied up until after you leave. You will also need to factor in extra time at the airport for the customs refund procedure. The days of a last-minute dash to the gate after a shopping spree will be over. Always carry your physical passport when shopping, as a photo on your phone is not sufficient. Lastly, keep all your receipts, as you'll need them for the refund process.
