Over 70% of Executives Aware of FY2026 Tax Reform: Prioritizing 'After-Tax Proceeds' in M&A, Yet Early Consultation Remains Stagnant

Overview and Background of the Survey

M&A Royal Advisory Co., Ltd. conducted a survey titled "Survey on FY2026 Tax Reform and M&A After-Tax Proceeds" targeting 760 business owners aged 40 to 75 who are interested in business succession. For owner-managers considering business succession, M&A is a potent option to solve succession issues and sustain company growth. In this context, not only the gross sale price but also the final after-tax proceeds in hand serve as a crucial decision-making factor. As the FY2026 tax reform may potentially affect the after-tax proceeds of owners in high-value company sales, this survey was carried out to clarify the actual situation.

Key Survey Results

### Tax Reform Awareness Over 70% When asked, "Are you aware that a tax reform will be implemented in fiscal year 2026?", 73.03% of business owners answered that they "know about it." However, 26.97% answered that they "have not heard of it." Furthermore, regarding the experience of researching details about the tax reform, only 24.50% of the total respondents answered that they "have investigated and understand the content to a certain extent." More than half of the respondents have only a superficial understanding or have simply heard about it.

### Awareness of Impact on After-Tax Proceeds During Company Sale In response to the question, "Do you know that in high-value company sales, the owner's after-tax proceeds may decrease?", only 15.5% of business owners answered that they "understand the content thoroughly." This reveals a reality where, despite superficial awareness of the system, understanding of the concrete impact on their own companies has not progressed.

### Prioritizing 'After-Tax Proceeds' Over 'Sale Price' When asked if they prioritize "after-tax proceeds" over the "sale price itself" when considering an M&A, a total of 76.2% of business owners answered that they "prioritize it more than the sale price" or "somewhat prioritize it." For owner-managers, M&A is directly linked to life planning after retirement; therefore, the final cash in hand is viewed as more important than the superficial price.

### Caution in Adjusting M&A Timing When asked whether they want to expedite or delay the execution of an M&A based on the potential tax burden, only 29.3% answered that they want to "expedite it." Conversely, 61.58% answered that "nothing has changed in particular." This indicates that because determining the timing of an M&A involves multiple complex elements such as performance trends, the presence of successors, and condition negotiations, it is difficult to determine the timing based solely on the single factor of tax reform. The survey showed that while interest in the tax reform is high, many business owners remain cautious regarding specific actions and strategic decisions involving experts.