Japan Intends to Include Homestays and Item Rentals into GDP
According to a report by Nikkei Asian Review, the Cabinet Office of Japan plans to include private room rentals (ie homestays) and item rentals in the "sharing economy" into the gross domestic product (GDP) starting in the fiscal year 2020.
In recent years, Japan's sharing economy industry has continued to develop, and the Japanese government hopes that GDP can accurately reflect the actual situation. According to estimates by the Cabinet Office, the amount not reflected in GDP at this stage is around 80 billion to 100 billion yen per year. Compared with Japan's current GDP of 550 trillion yen, the sharing economy accounts for a small proportion. However, with the growth of the sharing economy in the future, this number is expected to expand.
GDP shows the total amount of added value created within a certain period of time and is a key indicator that shows the overall economic status of a country. Nikkei Asian Review analyzes and believes that in the sharing economy, the handling fees (around 50 billion to 60 billion yen) paid by individuals and organizations to second-hand commodity trading applications and homestay operating companies have been included in the GDP through the company's operating data. However, the added value created by individuals has not been reflected, such as the income obtained by individuals by renting out empty rooms on the homestay website.
There are also professionals who believe that it is not difficult for Japan to include homestays in GDP from an operational point of view. The total expenditure of consumers on the platform, including platform fees and the income of the owners who provide homestays, is the added value of the homestay industry.
Japan's calculation of the output value of homestays in GDP this time means that Japan is facing squarely the emerging industry of homestays.
From June 15, 2018, Japan officially implemented the "Residential Accommodation Business Law" (New Homestay Law). The Residential Accommodation Business Law stipulates that those who intend to operate a homestay must submit an application with personal and real estate information to the government, and can legally provide accommodation services after being accepted. Otherwise, it is an illegal business. At the same time, the homeowner must make a housing roster. Guests need to register relevant information when staying.
This bill allows the government to more conveniently obtain relevant data about the homestay industry, such as collecting information such as operating income required to calculate GDP.
According to estimates by the Cabinet Office of Japan, Japan's sharing economy totaled approximately 630 billion to 670 billion yen in 2017, with an annual growth rate of approximately 50%. The c2c trading platform led by Mercari is the main force in Japan's sharing economy growth. However, the current international standard GDP calculation method does not count second-hand goods traded through Mercari and other platforms into the GDP. The reason is that second-hand products cannot generate new value through buying and selling.
Some Japanese commentators believe that the GDP calculation only emphasizes production as a reference benchmark, and does not fully reflect the wealth brought about by technological development. The Nomura Research Institute, a well-known Japanese research institution, estimates that the value of free digital services in Japan is about 42 trillion yen, equivalent to about 8% of GDP.