[dwg]

Japan has required amortization of capitalized software over five years for qualifying internal-use software since at least 2000. Correct me if I’m wrong, but I believe most other countries have similar rules.

Until 2022, U.S. companies had a real competitive advantage.

Software developer salaries in Japan are depressed—other roles too, but especially engineers. Without digging too deep, perhaps the previously unfavorable (now roughly equal) tax treatment of was perhaps a contributing factor.

[franciscop]

Dev here working in Japan for few years, I don't think the main reason software salaries are low in Japan is financial, but social/cultural. Software has traditionally not seen as valued as hardware, it was just an "extra" added on top of the hardware part. Basically never went through the startup revolution of the 2000s in US.

Also Japan is still very hierarchical, so old ideas change much slower. I would say the combination of these 2 are the main reason software is not as valued as in e.g. America, but there are many others like lack of international competitiveness due to the low English skill, ZIRP, and the ones you note seem totally valid ofc.

This is a very interesting recent report about salaries in Japan (e.g. foreigners, and/or foreigner companies get paid/pay a lot more):

https://www.tokyodev.com/articles/software-developer-salarie...

[dwg]

Essentially agree.

Nonetheless, if reports are to be believed the post-rule change decline is significant, and I can’t help but wonder how big of a positive feedback loop—in other words a bubble—was being created. The gap was, after all, built up over several decades.

The usual culprit you mentioned, perhaps aren’t as much of a factor as we usually ascribe to them.

Just speculating.

Thanks for sharing the report.

[stroebs]

> most other countries have similar rules.

This is the first instance I’ve heard of where salaries aren’t considered remuneration for basic labour. It’s a fairly weird interpretation of reality that spending $200k on a human’s availability results in a guaranteed $200k of capital being created, regardless of which country this kind of tax law exists in.