USGAAP Annual Report 3

Toyota Motor Corporation
31 July 2003


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Table of Contents

ITEM 10.    ADDITIONAL INFORMATION

10.A   SHARE CAPITAL

Not applicable.

10.B   MEMORANDUM AND ARTICLES OF ASSOCIATION

Set forth below is information relating to Toyota's common stock, including
brief summaries of the relevant provisions of Toyota's articles of incorporation
and share handling regulations, as currently in effect, and of the Commercial
Code of Japan and related legislation.

General

Toyota's authorized share capital as of March 31, 2003 is 9,740,185,400 shares,
of which 3,609,997,492 shares were issued. Under the Commercial Code, shares
must be registered and are transferable by delivery of share certificates. In
order to assert shareholders' rights against Toyota, a shareholder must have its
name and address registered on Toyota's register of shareholders, in accordance
with Toyota's share handling regulations. The registered beneficial holder of
deposited shares underlying the ADSs is the depositary for the ADSs.
Accordingly, holders of ADSs will not be able directly to assert shareholders'
rights.

A holder of shares may choose, at its discretion, to participate in the central
clearing system for share certificates under the Law Concerning Central Clearing
of Share Certificates and Other Securities of Japan. Participating shareholders
must deposit certificates representing all of the shares to be included in this
clearing system with Japan Securities Depository Center, Inc. If a holder is not
a participating institution in the Securities Center, it must participate
through a participating institution, such as a securities company or bank having
a clearing account with the Securities Center. All shares deposited with the
Securities Center will be registered in the name of the Securities Center on
Toyota's register of shareholders. Each participating shareholder will in turn
be registered on Toyota's register of beneficial shareholders and be treated in
the same way as shareholders registered on Toyota's register of shareholders.
For the purpose of transferring deposited shares, delivery of share certificates
is not required. Entry of the share transfer in the books maintained by the
Securities Center for participating institutions, or in the book maintained by a
participating institution for its customers, has the same effect as delivery of
share certificates. The registered beneficial owners may exercise the rights
attached to the shares, such as voting rights, and will receive dividends (if
any) and notices to shareholders directly from Toyota. The shares held by a
person as a registered shareholder and those held by the same person as a
registered beneficial owner are aggregated for these purposes. Beneficial owners
may at any time withdraw their shares from deposit and receive share
certificates.

Objects and Purposes

Article 2 of the Articles of Incorporation of Toyota states that its purpose is
to engage in the following businesses:

         •    the manufacture, sale, leasing and repair of:

         •     motor vehicles, industrial vehicles, ships, aircraft, other transportation machinery and apparatus,
               space machinery and apparatus, and parts thereof;

         •     industrial machinery and apparatus, other general machinery and apparatus, and parts thereof;

         •     electrical machinery and apparatus, and parts thereof; and

         •     measuring machinery and apparatus, medical machinery and apparatus, and parts thereof;

         •    the manufacture and sale of ceramics and synthetic resin products, and materials thereof;


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      •    the manufacture, sale and repair of construction materials and equipment, and machinery and apparatus
           relating to residential buildings;

      •    the planning, designing, supervision, execution and undertaking of construction work, civil engineering
           work, land development, urban development and regional development;

      •    the sale, purchase, leasing, brokerage and management of real estate;

      •    information processing, information communications and information supply services, and the development,
           sale and leasing of software;

      •    the design and development of product sales systems that utilize networks such as the Internet;

      •    the sale, leasing and maintenance of product sales systems that utilize networks, and sales of products
           through the use of such systems;

      •    the inland transportation, marine transportation, air transportation, stevedoring, warehousing and tourism
           businesses;

      •    the printing, publishing, advertising and publicity, general leasing, security and temporary staffing
           businesses;

      •    credit card operations, the purchase and sale of securities, investment consulting, investment trust
           operations, and other financial services;

      •    the operation and management of facilities, such as parking lots, showrooms, educational facilities, medical
           care facilities, sports facilities, marinas, airfields, food and drink stands and restaurants, lodging
           facilities, retail stores and others;

      •    the non-life insurance agency business and the life insurance agency business;

      •    the production and processing through the use of biotechnology of agricultural products, including trees,
           and the sale of such products;

      •    the sale of goods related to each of the preceding items and mineral oil; and

      •    conducting engineering, consulting and research and inventing products related to each of the preceding
           items and the utilization of such inventions and research, and any businesses incidental to or related to
           any of the preceding businesses.

Dividends

Under its articles of incorporation, Toyota's financial accounts will be closed
on March 31 of each year and dividends, if any, will be paid to shareholders of
record as of that date. In addition to year-end dividends, the board of
directors may by resolution declare an interim cash dividend to shareholders of
record as of September 30 of each year. Under the Commercial Code, however,
Toyota cannot declare or pay dividends unless specified financial criteria are
met based on the amount of its stated capital and legal reserves.

Under its articles of incorporation, Toyota is not obligated to pay any
dividends which are left unclaimed for a period of three years after the date on
which they first became payable.

Capital Accounts and Stock Splits

Under the Commercial Code, the entire amount of the issue price of new shares is
required to be accounted for as stated capital, although Toyota may account for
an amount not exceeding one-half of the issue price as additional paid-in
capital. Toyota may at any time transfer the whole or any part of its additional
paid-in capital and legal reserve to stated capital by resolution of the board
of directors. Toyota may also reduce the sum of its legal reserve and additional
paid-in capital to one-quarter or more of its stated capital by resolution of a
general meeting of shareholders. The whole or any part of retained earnings
which may be distributed as year-end dividends may also be transferred to stated
capital by resolution of an ordinary general meeting of shareholders.


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Toyota may at any time split the outstanding shares into a greater number of
shares by resolution of the board of directors. Toyota must give public notice
of the stock split, specifying a record date for the stock split, not less than
two weeks prior to the record date. In addition, promptly after the stock split
takes effect, Toyota must give notice to each shareholder specifying the number
of shares to which the shareholder is entitled by virtue of the stock split.


Japanese Unit Share System

General.    Consistent with the requirements of the Commercial Code, Toyota's
articles of incorporation provide that 100 shares constitute one 'unit'.
Although the number of shares constituting a unit is included in the articles of
incorporation, any amendment to the articles of incorporation reducing (but not
increasing) the number of shares constituting a unit or eliminating the
provisions for the unit of shares may be made by resolution of the board of
directors rather than by a special shareholders resolution, which is otherwise
required for amending the articles of incorporation. The number of shares
constituting one unit, however, cannot exceed the lesser of 1,000 shares and
one-two hundredths (1/200) of the number of all issued shares.

Voting Rights under the Unit Share System.    Under the unit share system,
shareholders have one voting right for each unit of shares that they hold. Any
number of shares less than a full unit will carry no voting rights.

Share Certificate for Less Than a Full Unit of Shares.    Toyota's articles of
incorporation provide that generally no share certificate for any number of
shares less than a unit will be issued. As the transfer of shares normally
requires delivery of share certificates, any fraction of a unit for which share
certificates are not issued will not be transferable.

Repurchase by Toyota of Shares Constituting Less Than a Unit.    A holder of
shares constituting less than a full unit may require Toyota to purchase those
shares at their market value in accordance with the provisions of Toyota's share
handling regulations.

Surrender of American Depositary Shares.    As a result of the unit share
system, ADR holders will only be permitted to surrender ADRs and withdraw
underlying shares constituting whole units. If a holder surrenders an ADR
representing shares that do not constitute an integral number of whole units,
the depositary will deliver to that holder only those shares which constitute a
whole unit. The depositary will then issue to the holder a new ADR representing
the remaining shares. Holders of an ADR that represents less than a whole unit
of underlying shares will be unable to withdraw the underlying shares. As a
result, those holders will be unable to require Toyota to purchase their
underlying shares to the extent those shares constitute less than one whole
unit.

Voting Rights

Toyota holds its ordinary general meeting of shareholders in June of each year
in or near Toyota City or in Nagoya City, Japan. In addition, Toyota may hold an
extraordinary general meeting of shareholders whenever necessary by giving at
least two weeks' advance notice. Under the Commercial Code, notice of any
shareholders' meeting must be given to each shareholder having voting rights or,
in the case of a non-resident shareholder, to his resident proxy or mailing
address in Japan in accordance with Toyota's share handling regulations, at
least two weeks prior to the date of the meeting.

A holder of shares constituting one or more whole units is generally entitled to
one vote per unit of shares subject to the limitations on voting rights set
forth in this paragraph. In general, under the Commercial Code, a resolution can
be adopted at a general meeting of shareholders by a majority of the shares
having voting rights represented at the meeting. The Commercial Code and
Toyota's articles of incorporation require a quorum for the election of
directors and corporate auditors of not less than one-third of the total number
of outstanding shares having voting rights. Toyota's shareholders are not
entitled to cumulative voting in the election of directors. A corporate
shareholder whose outstanding shares are in turn more than one-quarter directly
or indirectly owned by Toyota does not have voting rights.


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Shareholders may exercise their voting rights through proxies, provided that
those proxies are also shareholders who have voting rights.

The Commercial Code provides that a quorum of one-third of outstanding shares
with voting rights must be present at a shareholders' meeting to approve any
material corporate actions such as:

      •    amendment of the articles of incorporation,

      •    the removal of a director or corporate auditor,

      •    a dissolution, merger, consolidation or split-up of Toyota,

      •    the transfer of the whole or an important part of Toyota's business,

      •    the taking over of the whole of the business of any other corporation,

      •    any issuance of new shares (including transfer of treasury stock) at a specially favorable price (or any
           issuance of stock acquisition rights with specially favorable conditions or of bonds with stock acquisition
           rights with specially favorable conditions) to persons other than shareholders, and

      •    share exchange or share transfer for the purpose of establishing 100% parent-subsidiary relationships.

At least two-thirds of the shares having voting rights represented at the
meeting must approve these actions.

The voting rights of holders of ADSs are exercised by the depositary based on
instructions from those holders.

Subscription Rights

Holders of shares have no preemptive rights under Toyota's articles of
incorporation. Under the Commercial Code, the board of directors may, however,
determine that shareholders be given subscription rights in connection with a
particular issue of new shares, stock acquisition rights or bonds with stock
acquisition rights. In this case, such rights must be given on uniform terms to
all shareholders as of a specified record date by at least two weeks' prior
public notice to shareholders of the record date. Public or individual notice
must be given to each of these shareholders at least two weeks prior to the date
of expiration of the subscription rights.

Rights to subscribe for new shares may be transferable or nontransferable and
may be made substantially below the market price of shares. Accordingly, rights
offerings can result in substantial dilution or can result in rights holders not
being able to realize the economic value of those rights.

Liquidation Rights

In the event of a liquidation of Toyota, the assets remaining after payment of
all debts, liquidation expenses and taxes will be distributed among the
shareholders in proportion to the respective number of shares they own.

Liability to Further Calls or Assessments

All of Toyota's currently outstanding shares, including shares represented by
the ADSs, are fully paid and nonassessable.

Transfer Agent

UFJ Trust Bank Limited is the transfer agent for the shares. UFJ Trust's office
is located at 4-3, Marunouchi 1-chome, Chiyoda-ku, Tokyo, 100-0005 Japan. UFJ
Trust maintains Toyota's register of shareholders and records transfers of
record ownership upon presentation of share certificates.



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Record Date

The close of business on March 31 is the record date for Toyota's year-end
dividends, if paid. A holder of shares constituting one or more whole units who
is registered as a holder on Toyota's register of shareholders or register of
beneficial ownership at the close of business as of March 31 is also entitled to
exercise shareholders' voting rights at the ordinary general meeting of
shareholders with respect to the fiscal year ending on March 31. The close of
business on September 30 of each year is the record date for interim dividends,
if paid. In addition, Toyota may set a record date for determining the
shareholders entitled to other rights and for other purposes by giving at least
two weeks' public notice.

The shares generally trade ex-dividend or ex-rights in the Japanese stock
exchanges on the third business day before a record date (or if the record date
is not a business day, the fourth business day prior thereto), for the purpose
of dividends or rights offerings.

Repurchase by Toyota of Shares

Toyota may acquire its own shares (i) through a stock exchange on which such
shares are listed or by way of tender offer (pursuant to an ordinary resolution
of an ordinary general meeting of shareholders), (ii) by purchase from a
specific party (pursuant to a special resolution of an ordinary general meeting
of shareholders) or (iii) from a subsidiary of Toyota (pursuant to a resolution
of the board of directors). When such acquisition is made by Toyota from a
specific party other than a subsidiary of Toyota, any other shareholder may make
a demand to a representative director, more than five calendar days prior to the
relevant shareholders' meeting, that Toyota also purchase the shares held by
such shareholder. Any such acquisition of shares must satisfy certain
requirements, including that the total amount of the purchase price may not
exceed the amount of the retained earnings available for dividend payments after
taking into account any reduction, if any, of the stated capital, additional
paid-in capital or legal reserve (if such reduction of the stated capital,
additional paid-in capital or legal reserve has been authorized pursuant to a
resolution of the relevant ordinary general meeting of shareholders), minus the
amount to be paid by way of appropriation of retained earnings for the relevant
fiscal year and the amount to be transferred to stated capital. However, if it
is anticipated that the net assets on the balance sheet as at the end of the
immediately following fiscal year will be less than the aggregate amount of the
stated capital, additional paid-in capital and certain other items, Toyota may
not acquire such shares.

Shares acquired by Toyota may be held by it for any period or may be cancelled
by resolution of the board of directors. Toyota may also transfer to any person
the shares held by it, subject to a resolution of the board of directors, and
subject also to other requirements similar to those applicable to the issuance
of new shares. Toyota may also utilize its treasury stock for the purpose of
transfer to any person upon exercise of stock acquisition rights or for the
purpose of acquiring another company by way of merger, share exchange or
corporate split through exchange of treasury stock for shares or assets of the
acquired company.

The Commercial Code generally prohibits any subsidiary of Toyota from acquiring
shares of Toyota.

Acquisition or Disposition of Shares or ADS

Under the Foreign Exchange and Foreign Trade Law and the cabinet orders and
ministerial ordinances thereunder (collectively, the 'Foreign Exchange
Regulations'), all aspects of regulations on foreign exchange and foreign trade
transactions are, with minor exceptions relating to inward direct investments
(which are not generally applicable to Toyota's shares), only subject to post
transaction reporting requirements. Acquisitions and dispositions of shares of
common stock or ADS by non-residents of Japan (including foreign corporations
not resident in Japan) are generally not subject to this reporting requirement.
However, the Minister of Finance has the power to impose a licensing requirement
for transactions in limited circumstances.


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Report of Substantial Shareholdings

The Securities and Exchange Law of Japan and regulations under the Law require
any person who has become a holder (together with its related persons) of more
than 5% of the total issued shares of a company listed on any Japanese stock
exchange or whose shares are traded on the over-the-counter market (including
ADSs representing such shares) to file with the Director of a competent Local
Finance Bureau, within five business days, a report concerning those
shareholdings. A similar report must also be filed to reflect any change of 1%
or more in any shareholding or any change in material matters set out in reports
previously filed. Copies of any report must also be furnished to the company and
to all Japanese stock exchanges on which the company's shares are listed or, in
the case of shares traded on the over-the-counter market, the Japan Securities
Dealers Association. For this purpose, shares issuable to a 5% or greater
shareholder upon exercise of stock acquisition rights are taken into account in
determining both the number of shares held by that holder and the company's
total issued share capital.

10.C   MATERIAL CONTRACTS

All contracts concluded by Toyota during the two years preceding this filing
were entered into in the ordinary course of business.

10.D   EXCHANGE CONTROLS

The Foreign Exchange and Foreign Trade Law of Japan and its related cabinet
orders and ministerial ordinances (the 'Foreign Exchange Regulations') govern
the acquisition and holding of shares of capital stock of Toyota by 'exchange
non-residents' and by 'foreign investors.' The Foreign Exchange Regulations
currently in effect do not, however, affect transactions between exchange
non-residents to purchase or sell shares outside Japan using currencies other
than Japanese yen.

Exchange non-residents are:

      •    individuals who do not reside in Japan; and

      •    corporations whose principal offices are located outside Japan.

Generally, branches and other offices of non-resident corporations that are
located within Japan are regarded as residents of Japan. Conversely, branches
and other offices of Japanese corporations located outside Japan are regarded as
exchange non-residents.

Foreign investors are:

      •    individuals who are exchange non-residents;

      •    corporations that are organized under the laws of foreign countries or whose principal offices are located
           outside of Japan; and

      •    corporations (1) of which 50% or more of their shares are held by individuals who are exchange non-residents
           and/or corporations (a) that are organized under the laws of foreign countries or (b) whose principal
           offices are located outside of Japan or (2) a majority of whose officers, or officers having the power of
           representation, are individuals who are exchange non-residents.

In general, the acquisition of shares of a Japanese company (such as the shares
of capital stock of Toyota) by an exchange non-resident from a resident of Japan
is not subject to any prior filing requirements. In certain limited
circumstances, however, the Minister of Finance may require prior approval of an
acquisition of this type. While prior approval, as described above, is not
required, in the case where a resident of Japan transfers shares of a Japanese
company (such as the shares of capital stock of Toyota) for consideration
exceeding Y100 million to an exchange non-resident, the resident of Japan who
transfers the shares is required to report the transfer to the Minister of
Finance within 20 days from the date of the transfer, unless the transfer was
made through a bank, securities company or financial futures trader licensed
under Japanese law.


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If a foreign investor acquires shares of a Japanese company that is listed on a
Japanese stock exchange (such as the shares of capital stock of Toyota) or that
is traded on an over-the-counter market in Japan and, as a result of the
acquisition, the foreign investor, in combination with any existing holdings,
directly or indirectly holds 10% or more of the issued shares of the relevant
company, the foreign investor must file a report of the acquisition with the
Minister of Finance and any other competent Ministers having jurisdiction over
that Japanese company within 15 days from and including the date of the
acquisition, except where the offering of the company's shares was made
overseas. In limited circumstances, such as where the foreign investor is in a
country that is not listed on an exemption schedule in the Foreign Exchange
Regulations, a prior notification of the acquisition must be filed with the
Minister of Finance and any other competent Ministers, who may then modify or
prohibit the proposed acquisition.

Under the Foreign Exchange Regulations, dividends paid on, and the proceeds of
sales in Japan of, shares held by non-residents of Japan may in general be
converted into any foreign currency and repatriated abroad. Under the terms of
the deposit agreement pursuant to which Toyota's ADSs are issued, the Depositary
is required, to the extent that in its judgment it can convert yen on a
reasonable basis into dollars and transfer the resulting dollars to the United
States, to convert all cash dividends that it receives in respect of deposited
shares into dollars and to distribute the amount received (after deduction of
applicable withholding taxes) to the holder of ADSs.

10.E   TAXATION

The discussion below is intended for general information only and does not
constitute a complete analysis of all tax consequences relating to ownership of
shares of common stock or the ADSs. Prospective purchasers of shares of common
stock or the ADSs should consult their own tax advisors concerning the tax
consequences of their particular situations.

The following is a general summary of the principal U.S. federal income and
Japanese tax consequences of the acquisition, ownership and disposition of
shares of common stock or ADSs by an investor that holds those shares or ADSs as
capital assets within the meaning of Section 1221 of the Internal Revenue Code
of 1986, as amended (the 'Code'). This summary does not purport to address all
material tax consequences that may be relevant to holders of shares of common
stock or ADSs, and does not take into account the specific circumstances of any
particular investors, some of which (such as tax-exempt entities, banks,
insurance companies, broker-dealers, partnerships and other pass-through
entities, investors liable for alternative minimum tax, investors that own or
are treated as owning 10% or more of Toyota's voting stock, investors that hold
shares of common stock or ADSs as part of a straddle, hedge, conversion
transaction or other integrated transaction and U.S. Holders (as defined below)
whose functional currency is not the U.S. dollar) may be subject to special tax
rules. This summary is based on the tax laws of the United States and Japan,
judicial decisions, published rulings, administrative pronouncements, and United
States Treasury Regulations, all as in effect on the date hereof, as well as on
the current income tax convention between the United States and Japan (the '
Treaty'), all of which are subject to change (possibly with retroactive effect),
and to differing interpretations. In addition, this summary is based in part
upon the representations of the depositary and the assumption that each
obligation in the deposit agreement, and in any related agreement, will be
performed in accordance with its terms.

For purposes of this discussion, a 'U.S. Holder' is any beneficial owner of
shares of common stock or ADSs that is for U.S. federal income tax purposes:

1.     an individual citizen or resident of the United States,

2.     a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) organized in or
       under the laws of the United States, any state thereof, or the District of Columbia,

3.     an estate the income of which is subject to U.S. federal income tax without regard to its source, or

4.     a trust that is subject to the primary supervision of a U.S. court and the control of one or more U.S. persons,
       or that has a valid election in effect under applicable Treasury regulations to be treated as a U.S. person.


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An 'Eligible U.S. Holder' is a U.S. Holder that:

1.     is a resident of the United States for purposes of the Treaty,

2.     does not maintain a permanent establishment or fixed base in Japan to which shares of common stock or ADSs are
       attributable and through which the U.S. Holder carries on or has carried on business (or, in the case of an
       individual, performs or has performed independent personal services), and

3.     is otherwise eligible for benefits under the Treaty with respect to income and gain derived in connection with
       the shares of common stock or ADSs.

A 'Non-U.S. Holder' is any beneficial owner of shares of common stock or ADSs
that is not a U.S. Holder.

If a partnership holds shares of common stock or ADSs, the U.S. federal income
tax treatment of a partner generally will depend upon the status of the partner
and the activities of the partnership. Partners of a partnership holding shares
of common stock or ADSs should consult their own tax advisors.

This summary does not address any aspects of U.S. federal tax law other than
income taxation, and does not discuss any aspects of Japanese tax law other than
income taxation, inheritance and gift taxation and securities transfer taxation.
Investors are urged to consult their tax advisors regarding the U.S. federal,
state and local and Japanese and other tax consequences of acquiring, owning and
disposing of shares of common stock or ADSs. In particular, where relevant,
investors are urged to confirm their status as Eligible U.S. Holders with their
tax advisors and to discuss with their tax advisors any possible consequences of
their failure to qualify as Eligible U.S. Holders.

In general, taking into account the earlier assumptions, for purposes of the
Treaty and for U.S. federal income and Japanese tax purposes, owners of ADRs
evidencing ADSs will be treated as the owners of the shares of common stock
represented by those ADSs, and exchanges of shares of common stock for ADSs, and
exchanges of ADSs for shares of common stock, will not be subject to U.S.
federal income or Japanese tax.

Japanese Taxation

The following is a summary of the principal Japanese tax consequences (limited
to national taxes) to holders of shares of capital stock of Toyota and of ADRs
evidencing ADSs representing shares of common stock of Toyota who are
non-resident individuals or non-Japanese corporations without a permanent
establishment in Japan, ('non-resident Holders').

Generally, a non-resident of Japan or a non-Japanese corporation is subject to
Japanese withholding tax on dividends paid by Japanese corporations. Stock
splits in themselves are not subject to Japanese income tax.

In the absence of an applicable tax treaty, convention or agreement reducing the
maximum rate of withholding tax, the rate of Japanese withholding tax applicable
to dividends paid by Japanese corporations to non-residents of Japan or
non-Japanese corporations is 20 percent. With respect to dividends paid on
listed shares issued by a Japanese corporation (such as the shares of capital
stock of Toyota) to any corporate or individual shareholders (including those
shareholders who are non-Japanese corporations or Japanese non-resident
individuals, such as non-resident Holders), except for any individual
shareholder who holds 5 percent or more of the outstanding total of the shares
issued by the relevant Japanese corporation, the aforementioned 20 percent
withholding tax rate is reduced to (i) 10 percent for dividends due and payable
on or after 1st April, 2003 but on or before December 31, 2003, (ii) 7 percent
for dividends due and payable on or after January 1, 2004 but on or before March
31, 2008, and (iii) 15 percent for dividends due and payable on or after April
1, 2008. At the date of this annual report, Japan has income tax treaties,
conventions or agreements whereby the above mentioned withholding tax rate is
reduced, in most cases to 15 percent for portfolio investors with, among other
countries, Australia, Belgium, Canada, Denmark, Finland, France, Germany,
Ireland, Italy, Luxembourg, The Netherlands, New Zealand, Norway, Singapore,
Spain, Sweden, Switzerland, the U.K., and the U.S.


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Under the Tax Convention, as currently in force, the maximum rate of Japanese
withholding tax which may be imposed on dividends paid by a Japanese corporation
to an eligible U.S. holder generally is limited to 15 percent of the gross
amount actually distributed. If the maximum tax rate provided for in the income
tax treaty applicable to any particular non-resident Holder is lower than the
withholding tax rate otherwise applicable under Japanese tax law, such
non-resident Holder who is entitled to a reduced rate of Japanese withholding
tax on payment of dividends on Toyota's shares of capital stock by Toyota is
required to submit an Application Form for Income Tax Convention Regarding
Relief from Japanese Income Tax on Dividends in advance through Toyota to the
relevant tax authority before payment of dividends. A standing proxy for
non-resident Holders of a Japanese corporation may provide this application
service. With respect to ADRs, this reduced rate is applicable if the Depositary
or its agent submits two Application Forms (one before payment of dividends, the
other within eight months after Toyota's fiscal year-end). To claim this reduced
rate, any relevant non-resident Holder of ADRs will be required to file a proof
of taxpayer status, residence and beneficial ownership (as applicable) and to
provide other information or documents as may be required by the Depositary. A
non-resident Holder who is entitled, under an applicable income tax treaty, to a
reduced treaty rate lower than the withholding tax rate otherwise applicable
under Japanese tax law, but failed to submit the required application in advance
will be entitled to claim the refund of withholding taxes withheld in excess of
the rate under an applicable tax treaty from the relevant Japanese tax
authority.

Gains derived from the sale of shares of capital stock of Toyota of ADRs outside
Japan of shares by a non-resident Holder holding such shares or ADRs as
portfolio investors are, in general, not subject to Japanese income or
corporation tax. U.S. holders are not subject to Japanese income or corporation
tax with respect to such gains under the Tax Convention.

Japanese inheritance and gift taxes at progressive rates may be payable by an
individual who has acquired shares of capital stock or ADRs as a legatee, heir
or donee even though neither the individual nor the deceased nor the donor is a
Japanese resident.

Holders of shares of capital stock Toyota or ADRs should consult their tax
advisors regarding the effect of these taxes and, in the case of U.S. holders,
the possible application of the Estate and Gift Tax Treaty between the U.S. and
Japan.

U.S. Federal Income Taxation

U.S. Holders

Taxation of Dividends

Subject to the passive foreign investment company rules discussed below, under
U.S. federal income tax law, the gross amount of any distribution made by Toyota
in respect of shares of common stock or ADSs (without reduction for Japanese
withholding taxes) will constitute a taxable dividend to the extent paid out of
current or accumulated earnings and profits, as determined for U.S. federal
income tax purposes. That dividend generally will be included in the gross
income of a U.S. Holder, as ordinary income, when the dividend is actually or
constructively received by the U.S. Holder, in the case of shares of common
stock, or by the depositary, in the case of ADSs. The dividend will not be
eligible for the dividends-received deduction generally allowed to U.S.
corporations in respect of dividends received from other U.S. corporations.
However, pursuant to recently enacted legislation, dividends paid to certain
U.S. Holders (including individuals) may be eligible for preferential U.S.
federal income tax rates.

A dividend paid in Japanese yen will be included in gross income in a U.S.
dollar amount based on the Japanese yen/U.S. dollar exchange rate in effect on
the date that the dividend is included in the gross income of the U.S. Holder,
regardless of whether the payment is converted into U.S. dollars. Generally, any
gain or loss resulting from currency exchange fluctuations during the period
from the date the dividend payment is included in the gross income of a U.S.
Holder through the date that payment is converted into U.S. dollars (or
otherwise disposed of) will be treated as U.S. source ordinary income or loss.



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To the extent, if any, that the amount of any distribution received by a U.S.
Holder in respect of shares of common stock or ADSs exceeds Toyota's current and
accumulated earnings and profits, as determined for U.S. federal income tax
purposes, the distribution first will be treated as a tax-free return of capital
to the extent of the U.S. Holder's adjusted tax basis in those shares or ADSs,
and any balance in excess of that adjusted tax basis will be treated as U.S.
source capital gain.

Distributions of additional shares of common stock that are made to U.S. Holders
with respect to their shares of common stock or ADSs, and that are part of a pro
rata distribution to all of Toyota's shareholders, generally will not be subject
to U.S. federal income tax.

For U.S. foreign tax credit purposes, dividends included in gross income by a
U.S. Holder in respect of shares of common stock or ADSs will constitute income
from sources outside the United States, and generally will be treated
separately, together with other items of 'passive income' (or, in the case of
some holders, 'financial services income'), in computing foreign tax credit
limitations. Subject to generally applicable limitations under U.S. federal
income tax law and the Treaty, any Japanese withholding tax imposed in respect
of a Toyota dividend may be claimed as a credit against the U.S. federal income
tax liability of a U.S. Holder, if the U.S. Holder so elects (or as a deduction
from that U.S. Holder's taxable income). Special rules generally will apply to
the calculation of foreign tax credits, in respect of dividend income that
qualifies for preferential U.S. federal income tax rates under recently enacted
legislation. Additionally, special rules apply to individuals whose foreign
source income during the taxable year consists entirely of 'qualified passive
income' and whose creditable foreign taxes paid or accrued during the taxable
year do not exceed $300 ($600 in the case of a joint return). Further, under
some circumstances, a U.S. Holder that:


          (i)    has held shares of common stock or ADSs for less than a specified minimum period,

          (ii)   is obligated to make payments related to Toyota dividends, or

          (iii)   holds the shares of common stock or ADSs in an arrangement in which the holder's expected economic
                  return, after non-U.S. taxes, is insubstantial,


will not be allowed a foreign tax credit for Japanese taxes imposed on Toyota
dividends.

Investors are urged to consult their tax advisors regarding the availability of
the foreign tax credit under their particular circumstances. The IRS has
expressed concern that parties to whom ADSs are released may be taking actions
that are inconsistent with the claiming of foreign tax credits by U.S. Holders
of ADSs. Accordingly, investors should be aware that the discussion above
regarding the creditability of Japanese withholding tax on dividends could be
affected by future actions that may be taken by the IRS.

Taxation of Capital Gains

A U.S. Holder's tax basis in a share of common stock or an ADS generally will
equal the U.S. dollar cost of that common stock or ADS. In general, upon a sale
or other disposition of shares of common stock or ADSs, a U.S. Holder will
recognize gain or loss for U.S. federal income tax purposes in an amount equal
to the difference between the amount realized and the U.S. Holder's adjusted tax
basis in those shares or ADSs. Subject to the passive investment company rules
discussed below, such gain or loss generally will be capital gain or loss and,
if the U.S. Holder's holding period for those shares or ADSs exceeds one year,
will be long-term capital gain or loss. Some U.S. Holders, including
individuals, are eligible for preferential rates of U.S. federal income tax in
respect of long-term capital gain. Under U.S. federal income tax law, the
deduction of capital losses is subject to limitations. Any gain or loss
recognized by a U.S. Holder in respect of the sale or other disposition of
shares of common stock or ADSs generally will be treated as U.S. source income
or loss for U.S. foreign tax credit purposes.



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Passive Foreign Investment Companies

A non-U.S. corporation generally will be classified as a passive foreign
investment company (a 'PFIC') for U.S. federal income tax purposes in any
taxable year in which, after applying look-through rules, either (1) at least
75% of its gross income is passive income, or (2) on average at least 50% of the
gross value of its assets is attributable to assets that produce passive income
or are held for the production of passive income. Passive income for this
purpose generally includes dividends, interest, royalties, rents and gains from
commodities and securities transactions. The PFIC determination is made annually
and generally is based on the value of a non-U.S. corporation's assets
(including goodwill) and composition of its income.

Toyota does not believe that it is a PFIC for U.S. federal income tax purposes,
and intends to continue its operations in such a manner that it will not become
a PFIC in the future although no assurances can be made regarding determination
of our PFIC status in the current or any future taxable year. If Toyota becomes
a PFIC, U.S. Holders could be subject to additional U.S. federal income taxes on
gain recognized with respect to the shares of common stock or ADSs and on
certain distributions. In addition, an interest charge may apply to certain
taxes treated as having been deferred by the U.S. Holder under the PFIC rules.
Toyota will inform U.S. Holders if it believes that it will be classified as a
PFIC in any taxable year.

Prospective investors should consult their own tax advisors regarding the
potential application of the PFIC rules to shares of common stock or ADSs.

Non-U.S. Holders

Subject to the discussion below under 'Backup Withholding and Information
Reporting', a Non-U.S. Holder generally will not be subject to any U.S. federal
income or withholding tax on distributions received in respect of shares of
common stock or ADSs unless the Non-U.S. Holder conducts a trade or business
within the United States and the distributions are effectively connected with
that trade or business.

Subject to the discussion below under 'Backup Withholding and Information
Reporting', a Non-U.S. Holder generally will not be subject to U.S. federal
income tax in respect of gain recognized on a sale or other disposition of
shares of common stock or ADSs, unless (i) the gain is effectively connected
with a trade or business conducted by the Non-U.S. Holder within the United
States, or (ii) the Non-U.S. Holder is an individual who was present in the
United States for 183 or more days in the taxable year of the disposition and
other conditions are met.

Backup Withholding and Information Reporting

In general, information reporting requirements will apply to dividends paid to a
U.S. Holder in respect of shares of common stock or ADSs, and to the proceeds
received upon the sale, exchange or redemption of the shares of common stock or
ADSs within the United States by U.S. Holders. Furthermore, a backup withholding
tax may apply to those amounts (currently at a 28% rate) if a U.S. Holder fails
to provide an accurate tax identification number, to certify that such holder is
not subject to backup withholding or to otherwise comply with the applicable
requirements of the backup withholding requirements. The amount of backup
withholding imposed on a payment to a U.S. Holder generally may be claimed as a
credit against the holder's U.S. federal income tax liability provided that the
required information is properly furnished to the IRS.

Dividends paid to a Non-U.S. Holder in respect of shares of common stock or
ADSs, and proceeds received in the sale, exchange or redemption of shares of
common stock or ADSs by a Non-U.S. Holder, generally are exempt from information
reporting and backup withholding under current U.S. federal income tax law.
However, a Non-U.S. Holder may be required to provide certification of non-U.S.
status in order to obtain that exemption.

Persons required to establish their exempt status generally must provide such
certification on IRS Form W-9, entitled Request for Taxpayer Identification
Number and Certification, in the case of U.S. persons, and on IRS Form W-8BEN,
entitled Certificate of Foreign Status (or other appropriate IRS Form W-8), in
the case of non-



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U.S. persons. U.S. Treasury regulations have generally expanded the
circumstances under which information reporting and backup withholding may apply
unless the holder provides the information described above. Investors should
consult their tax advisors regarding the application of the information
reporting and backup withholding rules to their particular situation.


10.F   DIVIDENDS AND PAYING AGENTS

Not applicable.


10.G   STATEMENT BY EXPERTS

Not applicable.


10.H   DOCUMENTS ON DISPLAY

Toyota files annual reports on Form 20-F and reports on Form 6-K with the SEC.
You may read and copy this information at the SEC's Public Reference Room at 450
Fifth Street, N.W., Washington, D.C. 20549 or by accessing the SEC's home page
(http://www.sec.gov). You can also request copies of the documents, upon payment
of a duplicating fee, by writing to the Public Reference Section of the SEC.
Please call the SEC at  1-800-SEC-0330 for further information on the operation
of the Public Reference Room. In addition, Toyota's reports, proxy statements
and other information may be inspected at the offices of the New York Stock
Exchange, 20 Broad Street, New York, New York 10005. Copies of the documents
referred to herein may also be inspected at Toyota's offices by contacting
Toyota at 1 Toyota-cho, Toyota City, Aichi Prefecture 471-8571, Japan,
attention: Financial Reporting Department, Accounting Division, telephone
number: 81-565-28-2121.


10.I   SUBSIDIARY INFORMATION

Not applicable.

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ITEM 11.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Toyota is exposed to market risk from changes in foreign currency exchange
rates, interest rates and certain commodity and equity security prices. In order
to manage the risk arising from changes in foreign currency exchange rates and
interest rates, Toyota enters into a variety of derivative financial
instruments.

A description of Toyota's accounting policies for derivative instruments is
included in note 2 to Toyota's consolidated financial statements and further
disclosure is provided in notes 20 and 21 to Toyota's consolidated financial
statements.

Toyota monitors and manages these financial exposures as an integral part of its
overall risk management program, which recognizes the unpredictability of
financial markets and seeks to reduce the potentially adverse effect on Toyota's
operating results.

The financial instruments included in the market risk analysis consist of all of
Toyota's cash and cash equivalents, marketable securities, finance receivables,
securities investments, long-term and short-term debt and all derivative
financial instruments. Toyota's portfolio of derivative financial instruments
consists of foreign exchange forward contracts, foreign currency options,
interest rate swaps, interest rate currency swaps agreements and interest rate
options. Anticipated transactions denominated in foreign currencies that are
covered by Toyota's derivative hedging are not included in the market risk
analysis. Although operating leases are not required to be included, Toyota has
included these instruments in determining interest rate risk.

Foreign Currency Exchange Rate Risk

Toyota has foreign currency exposures related to buying, selling and financing
in currencies other than the local currencies in which it operates. Toyota is
exposed to foreign currency risk related to future earnings or assets and
liabilities that are exposed due to operating cash flows and various financial
instruments that are denominated in foreign currencies. Toyota's most
significant foreign currency exposures relate to the United States and Western
European countries.

Toyota uses a value-at-risk analysis ('VAR') to evaluate its exposure to changes
in foreign currency exchange rates. The value-at-risk of the combined foreign
exchange position represents a potential loss in pre-tax earnings that are
estimated to be Y24.0 billion as of March 31, 2002 and Y29.5 billion as of March
31, 2003. Based on Toyota's overall currency exposure (including derivative
positions), the risk during the year ended March 31, 2003 to pre-tax cash flow
from currency movements was on average Y25.7 billion, with a high of Y29.5
billion and a low of Y22.2 billion.

The value at risk was estimated by using a Monte Carlo Simulation method and
assumed 95% confidence level on the realization date and a 10-day holding
period.

Interest Rate Risk

Toyota is subject to market risk from exposure to changes in interest rates
based on its financing, investing and cash management activities. Toyota enters
into various financial instrument transactions to maintain the desired level of
exposure to the risk of interest rate fluctuations and to minimize interest
expense. Certain exchange traded future and option contracts, interest rate caps
and floors, along with various investments, have been entered into to reduce the
interest rate risk related to these activities. The potential decrease in fair
value resulting from a hypothetical 100 basis point upward shift in interest
rates would be approximately Y28.3 billion as of March 31, 2002 and Y23.1
billion as of March 31, 2003.

There are certain shortcomings inherent to the sensitivity analyses presented.
The model assumes interest rate changes are instantaneous parallel shifts in the
yield curve; however, in reality, changes are rarely instantaneous. Although
certain assets and liabilities may have similar maturities or periods to
repricing, they

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may not react correspondingly to changes in market interest rates. Also, the
interest rates on certain types of assets and liabilities may fluctuate with
changes in market interest rates, while interest rates on other types of assets
may lag behind changes in market rates. Finance receivables are less susceptible
to prepayments when interest rates change and, as a result, Toyota's model does
not address prepayment risk for automotive related finance receivables. However,
in the event of a change in interest rates, actual loan prepayments may deviate
significantly from assumptions used in the model.

Commodity Price Risk

Commodity price risk is the possibility of higher or lower costs due to changes
in the prices of commodities, such as non-ferrous (e.g., aluminum), precious
metals (e.g., palladium, platinum and rhodium) and ferrous alloys (e.g., steel),
which Toyota uses in the production of motor vehicles. Toyota does not use
derivative instruments to hedge the price risk associated with the purchase of
those commodities and controls its commodity price risk by holding minimum stock
levels.

Equity Price Risk

Toyota holds investments in various available-for-sale securities which are
subject to price risk. The fair value of available-for-sale securities was
approximately Y564.4 billion as of March 31, 2002 and the fair value of
available-for-sale equity securities was approximately Y487.6 billion as of
March 31, 2003. The potential change in the fair value of these investments,
assuming a 10% change in prices, would be approximately Y56.4 billion as of
March 31, 2002 and Y48.8 billion as of March 31, 2003.


ITEM 12.    DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable.


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                                    PART II


ITEM 13.    DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

None.


ITEM 14.    MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

None.


ITEM 15.    CONTROLS AND PROCEDURES


Within 90 days prior to the date of this annual report, Toyota performed an
evaluation of the effectiveness of the design and operation of its disclosure
controls and procedures. Disclosure controls and procedures are designed to
ensure that the material financial and non-financial information required to be
disclosed in Form 20-F and filed with the Securities and Exchange Commission is
recorded, processed, summarized and reported in a timely manner. The evaluation
was performed under the supervision of Hiroshi Okuda, Toyota's Chairman of the
Board, and Ryuji Araki, Toyota's Executive Vice President, Member of the Board.
In designing and evaluating the disclosure controls and procedures, management
recognized that any controls and procedures, no matter how well designed and
operated, can provide only reasonable, rather than absolute, assurance of
achieving the desired control objectives. Managerial judgment was necessary to
evaluate the cost-benefit relationship of possible controls and procedures.
Based on the foregoing, Mr. Okuda and Mr. Araki have concluded that Toyota's
disclosure controls and procedures were effective.

There have been no significant changes in Toyota's internal controls or in other
factors that could significantly affect internal controls subsequent to the date
of the evaluation. Therefore, no corrective action was taken.

ITEM 16A.   (RESERVED)

ITEM 16B.   CODE OF ETHICS

Toyota has adopted a code of ethics that applies to its directors and managing
officers, including its principal executive officer, principal financial
officer, principal accounting officer or controller, or persons performing
similar functions. A copy of Toyota's code of ethics is attached as an exhibit
to this annual report on Form 20-F.

ITEM 16C.   (RESERVED)



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                                    PART III

ITEM 17.    FINANCIAL STATEMENTS

Not applicable.


ITEM 18.    FINANCIAL STATEMENTS

The following financial statements are filed as part of this annual report on
Form 20-F.


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