On October 1, 2019 consumption tax in Japan will increase from 8 per cent to ten. According to Jiji, the tax will not apply to food and drinks served in restaurants. It will be applied to arcade games.
For decades, arcades have been built around a single coin experience, either the 50 yen coin or the 100 yen one.
“This industry might vanish,” a 47-year-old arcade owner in Yokohama told Sankei Business. “We cannot raise the price of a 100 yen game to 110 yen. The only choice is for the arcade to absorb the tax increase.”
That cuts into an already shrinking bottom line.
Japan’s arcade industry has been facing challenges in the past decade. In 2006, there were 24,000 arcades in Japan. By 2016, however, that number had decreased by nearly half to 14,000.
However, the number of arcades that accept digital money has increased, which could help ease the tax burden. Mum-and-pop arcades might not have the capital to invest in digital money readers.
Another unnamed man who ran an arcade in Kawasaki that was closed this summer told the Sankei, “It’s good not envisioning how things will turn out. Seeing one’s fate is a heart-breaking thing.”