Effective 01 November 2026, Japan’s duty-free system will undergo significant changes.
The system will shift from the previous “tax-free at purchase (immediate refund)” method to the “post-pay system (refund system)”, in which consumption tax is included in the payment at the time of purchase, and the refund is issued after the traveler’s departure is confirmed.
As a result of this change, the timing of refund payments will change as follows :
Old System: Tax-free processing at the time of purchase (completed on the spot)
New System: Refund paid after the traveler’s departure is confirmed (post-pay)
The most significant change under the new system is that refunds will be received after the traveler’s departure.
Consequently, duty-free shops will meet the following new operational requirements :
Management of refund payments after departure verification
Handling remittances to overseas residents
Payment processing supporting multiple currencies and nationalities
Digitization and automation of refund operations
Unlike the traditional “duty-free processing completed at the store,” “how to establish post-departure payment operations” has become a key challenge.
Under the new system, duty-free shops are required to take the following actions :
(1) Redesigning the Refund Payment Process
Establishing a payment flow following departure verification
Managing the linkage between customer information and refund data
(2) Handling International Money Transfers
Support for transfers in various national currencies
Securing diverse receipt methods, such as banks and digital wallets
(3) Streamlining Operations
Reducing manual refund processing
Automation through system integration
Under the new system, the following become key themes for duty-free shops :
How to pay refunds smoothly
How to reduce the stress travelers face when receiving refunds
How to reduce the operational burden on stores
In particular, since travelers have already departed the country, a “reliable international remittance infrastructure” is essential.
KABAYAN International Ltd. is building a remittance network to countries around the world and is promoting the development of international remittance infrastructure in the tax refund sector.
Currently, the company is expanding its network in the following areas :
Expansion of the remittance network to include Asia, the Middle East, and Europe
Establishment of a remittance infrastructure for multinational travelers
Development of a remittance scheme dedicated to tax refunds
Through these efforts, the company aims to enable faster and more seamless payment of tax refunds from duty-free shops to international travelers.
The ideal workflow under the new system is as follows :
Purchase at a duty-free shop (payment includes consumption tax)
Confirmation of departure
Determination of refund amount
Overseas remittance via the KABAYAN International remittance network
Traveler receives funds in their home country
This system will digitize and automate duty-free shop refund operations, delivering seamless customer experience.
Under the new system, key challenges for duty-free shops will be :
“Payment of refunds after departure”
“Overseas remittance support”
“Digitization of operations”
will be key themes.
In addressing these challenges, KABAYAN International has the potential to contribute as an infrastructure for refund payments leveraging its global remittance network.
Please feel free to contact us for consultations regarding compliance with the new system or the development of remittance schemes.
Tel No. : 03-5817-8917
E-mail : kabayanjp@eui.money
(Global remittance network currently under development)