Ishiba Gives Consumption Tax Cut Up

Prime Minister Shigeru Ishiba reportedly decided not to introduce consumption tax cut in the campaign platform of his Liberal Democratic Party for election of the House of Councillors in July. Although some LDP lawmakers and its coalition partner, Komeito, hoped to appeal consumption tax cut to the voters, Ishiba finally accepted negative views of LDP leaders. Ishiba needs to establish policy package for minimizing negative impact of tariff policy of the United States without consumption tax reduction.

In a meeting with LDP Secretary General, Hiroshi Moriyama, on May 8th, Ishiba agreed on a notion that the party should spare consumption tax cut. Consumption tax is a fiscal resource for social security policies. They shared a recognition that it is hard for them to find an alternative source for social security and that the tax cut is not appropriate as a policy for price inflation.

 

It is estimated that the government will lose several trillion yen of revenue, if consumption tax cut is introduced. It may cause serious fiscal deficit in the time when Japanese society is growingly old and needs stable system to support aged people. If the government issues additional governmental bonds, they will be a great burden for future generations. Ishiba realizes that consumption tax is a highly important revenue for maintaining social security system.

 

Some skepticisms have already been argued. It takes certain time to introduce a tax cut, because it needs discussion in the Diet for revising related laws or for verification whether alternative fiscal resource is appropriate. The retailers, most of whom are mid- or small-size businesses, need to revise current system or introduce new system to meet new tax rate.

 

Ishiba’s decision made the contrast of policies in the election clear. The biggest opposition party, Constitutional Democratic Party of Japan (CDPJ) has announced late April that it would include consumption tax cut in its campaign platform. The party expects consumption tax rate for foods to eliminate to 0 percent for a year. Although CDPJ has been upholding introduction of tax credits with benefits, as an alternative to consumption tax cut, it regards the campaign policy as a transitional measure toward the ultimate goal.

 

Japan Innovation Party requires 0 percent rate for foods, while Democratic Party for the People argues temporary 5 percent for all goods. Reiwa Shinsengumi and Japan Communist Party demand abolition of consumption tax. It is remarkable that Komeito, the coalition partner of the LDP, still hopes to include consumption tax cut in economic stimulus package which will be delivered before the election.

 

No party except the LDP, however, has shown alternative fiscal resource for consumption tax cut. As the leading party supporting Ishiba administration, the LDP is going to emphasize its responsibility to keep social security system for the people.

Comments

Post a Comment

Popular posts from this blog

Amendment of Local Autonomy Law

The House of Representatives started discussion on revision of the Local Autonomy Law, which would vest the national government a power to instruct local government in an emergency. It may change the relationship between the national and local government, which has been recognized as equal. The opposition parties oppose the amendment, arguing that it would give the national government an excessive power.   With the Meiji Restoration, the national government abolished the feudal system, introducing modern governance. However, its autonomy was not sufficient. The governor of each prefecture was appointed by the national government. The local governments subordinated to the national government. It was as late as 2000 when  the Comprehensive Decentralization Law  was enacted and the relationship between the national and local government was defined as equal.   The national government found inconvenience in the relationship between the national and local government, when ...
Read more

Request for Final Nuclear Disposal Site

Ministry of Economy, Trade and Industry requested Genkai Town, Saga, to accept “literature survey” for building a final disposal site for high-level radioactive waste. Genkai is going to answer within this month. If it accepts, it will be the third place to accept that survey, following two places in Hokkaido. Main reason to accept the survey is supposed to be subsidy from the national government.   Japan has no final disposal site. Among all 54 reactors in 17 nuclear power generation plant, 12 reactors of 6 plants are operating. The rest of them are not in operation, some of which are determined to be decommissioned. Used nuclear fuels are stocked in each plant, 　 or have sent to a reprocessing plant in Rokkasho, Aomori. There are two plans to stock nuclear wastes in the intermediate facility for disposal, one is already built and another is still in negotiation.   Nuclear Fuel Final Disposal Act in 2000 determines to bury nuclear waste in the underground. Literature survey, ...
Read more

Death Penalty Demanded on Criminal of Arson

On the historically brutal case of arson, the public prosecutors demanded an ultimate penalty to the offender. In the trial on the arson and murder in Kyoto Animation in 2019, the prosecutors requested death penalty on the defendant, Shinji Aoba. The lawyers of Aoba argued that the court should avoid sentencing death penalty. The judgement will be passed next January. Aoba was indicted as putting fire after pouring gasoline in the building of Kyoto Animation (Kyoani), a studio producing animation works, and killed 36 staffs and injured 32 on July 18 th , 2019. In the trial, Aoba argued that he could not tolerate Kyoani, because it had stolen his novel story in its works. Aoba later apologized to the victim’s families that he had done too much and regretted it.   In the closing argument in Kyoto Regional Court, the prosecutors demanded death penalty for Aoba, because the number of victims were extremely high in the history of criminal trials in Japan. “It is hard to describe about h...
Read more