Japan just posted its highest gold export figure since records began in fiscal 1988. Exports hit 4.08 trillion yen, roughly $25 billion, in fiscal year 2025, a 35.6% jump from the prior year.

That’s a staggering number on its own. But the more interesting story is what’s happening on the other side of the ledger: gold imports surged to 177.7 billion yen, climbing nearly 120% year-over-year.

The smuggling problem hiding in plain sight

Japan levies a 10% consumption tax on gold purchases. If you buy gold domestically, you pay that tax. If you import gold legally, you pay it at the border.

But if you smuggle gold into the country and sell it, you pocket that 10% premium without ever paying the government. Then the gold can be re-exported at market price, and the cycle repeats.

Analysts believe a meaningful portion of the import surge is driven by exactly this kind of tax evasion scheme. Japanese authorities have ramped up enforcement efforts against gold smuggling, particularly throughout 2024 and 2025. But the exact proportion attributed to smuggled gold is still an estimate, not a hard figure.

Where all that gold is going

Major export destinations include Hong Kong, Switzerland, Singapore, the UK, and Chinese Taipei.

Context: Japan’s evolving role in global gold markets

Japan is not a major gold producer. It doesn’t have large-scale mining operations comparable to Australia or South Africa. Instead, Japan’s gold trade is largely driven by recycled gold from electronics, jewelry, and industrial applications, along with previously imported bullion.

The fact that FY2025 represents the highest export level since tracking began in fiscal 1988 puts this moment in historical perspective. Data for fiscal 2025, which spans April through March, was released by Japan’s Finance Ministry.