CIRJE-J-54. Mochida, Nobuki, "Intergovernmental Allocation of Value Added Tax in Japan: International comparison", May 2001.

Japan's Local Consumption Tax is unique in the sense that it combines origin-based piggy backing on the national VAT with a clearing system that is intended to reflect the destination principle indirectly. This paper seeks to assess LCT in the light of equity, efficiency and simplicity. Studying international experiences, this paper argues the case for destination principle as a tax principle on interregional trade. Finally, we investigate the way in which discretion on tax rate setting can be allowed to Japan's local consumption tax.