Japan raps Russia over tax-free zones on N-isles

Jiji Press

17:39 JST, March 10, 2022

TOKYO (Jiji Press) — Chief Cabinet Secretary Hirokazu Matsuno on Thursday criticized Russia for enacting a law on establishing tax-free special zones on northwestern Pacific islands at the center of the two countries’ long-standing territorial dispute.

Russian President Vladimir Putin on Wednesday signed the law for its enactment after the legislation was approved by the upper and lower houses of Russia’s parliament on Friday last week.

The Russian law will partially or fully reduce tax payments by domestic and foreign businesses advancing into the special zones on the islands, known as the northern territories in Japan, for 20 years.

The Russian move is “incompatible with Japan’s position on the northern territories and the purpose of Japan-Russia joint economic activities on the islands that have been discussed based on an agreement between the two countries’ leaders,” Matsuno told a press conference.

“It’s regrettable, and we have told the Russian side afresh about our view on the matter,” the top Japanese government spokesman added.

The islands were seized by the former Soviet Union from Japan at the end of World War II and have long been claimed by Japan. The territorial row has prevented Tokyo and Moscow from concluding a peace treaty to formally end their wartime hostilities.