Quantcast Consumption Tax Exemption Procedures on Purchase of Goods and Sevices by the United States

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satisfactory. If the Government exercises this option, the extended contract shall be considered to
include this option provision.
(End of clause)
5252.229-9302 CONSUMPTION TAX EXEMPTION PROCEDURES ON PURCHASE OF
GOODS AND SERVICES BY THE UNITED STATES ARMED FORCES IN JAPAN
[JAPANESE LAW NO. 108, 1988] (JUN 1994)
(a) The Consumption Tax Law (Law No. 108, 1988) was enacted in the Diet of Japan on 24
December 1988, and applied from April 1, 1989. The Government of Japan (GOJ) and the United
States Government (USG), in accordance with paragraph 3, Article XII, of the "The Agreement Under
Article VI of the Treaty of Mutual Cooperation And Security Between Japan And The United States of
America Regarding Facilities And Areas And The Status of United States Armed Forces In Japan"
(SOFA), have agreed upon procedures for exempting the United States from the Consumption Tax on
the following transactions upon appropriate certification:
(1) Goods and services purchased in Japan for official purposes of the U. S.
Armed Forces by the U. S. Armed Forces or its authorized procurement agencies;
(2) Goods and services purchased in Japan, by persons, including corporations, who are
designated by the USG in accordance with the provisions of paragraphs 1 and 2, Article XIV of the
SOFA (Article XIV Contractors), solely for the purpose of performing the business of construction,
maintenance or operation under the contract for construction, etc., for use by the U. S. Armed
Forces, or film and gasoline purchased in Japan by Article XIV Contractors solely for the business
activities described above.
(b) The underlying objective is to obtain the full amount of the exemption from the tax on U.S. Forces
procurements immediately at the time of purchase, and at the same time give the Contractor a proof
of purchase document, acceptable to GOJ tax authorities, which he/she can present to the tax
authorities to obtain a tax credit and/or refund for tax already collected and paid by previous sellers.
(c) By the submission of their offer, the offeror certifies that Japanese consumption tax is not part of
the bid price, nor will it be a part of any subsequent modification to the contract. Procedures for
Contractors to obtain a consumption tax credit are described in a handbook that may be obtained
from the Procuring Contracting Office.
(End of clause)
5252.232-9302 LIMITATIONS ON EXTENT OF GOVERNMENT LIABILITY IN THE EVENT
OF A BUY-OUT PRIOR TO COMMENCEMENT OF CONSTRUCTION (JUL 1998)
(a) For the purpose of this clause, functional elements are defined as room layout and space
allocations as determined by partitions, doors, or other architectural features. Aesthetic elements are
defined as the facility's visual appearance and appeal.
(b) If the government and the contractor are unable to mutually agree on the functional and aesthetic
elements of the project design, the government may initiate a buy-out of the contract prior to the
commencement of construction for a maximum settlement amount not to exceed four (4) percent of
the contract amount. This amount shall be negotiated based on a reasonable cost incurred and may
include a reasonable profit.
-28-
JUNE 1999





 


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