Shoppers splurge ahead of sales tax increase

Picture expired. Customers check Japanese fashion giant Uniqlo's newly design outfits featuring French fashion icon Ines de la Fressange at Uniqlo's flagship shop in Tokyo on March 20, 2014 AFP

The requested article has expired, and is no longer available. Any related articles, and user comments are shown below.

  • 4

    Serrano

    There should be mass protests against this ridiculous tax hike.

  • 2

    Abhorsenaube

    I hope this adds more pressure to companies to begin seriously considering wage increases rather than cause the slow down and hurt families already on a tight budget.

  • 0

    some14some

    Still, not everyone thinks the late nineties slowdown will repeat itself.

    yeah, not everyone but majority of them are fearing record slow down.

  • 4

    umbrella

    In effect this tax rise is in order to give the billions of dollars to Ukraine. Ridiculous and criminal. America orders and Japan jumps. The economy is going to absolutely nosedive. Put your seat belts on.

  • 3

    CrazyJoe

    It's actually a 60% hike in the national sales tax. (5% to 8%). A big-ticket spree before the new taxes bite?

  • -2

    Anna Louise

    I already got all my electrical stuff ahead of time. It is cheaper to buy clothing etc. at Amazon.com. There are ways to break even if one just shops around for necessities!

  • 1

    John Galt

    " Still, not everyone thinks the late nineties slowdown will repeat itself."

    True. The ostriches, like Hiroshi Miyazaki, who though well-credentialed are in clear denial of reality. Ask the consumers.

  • 4

    kibousha

    Sheeps are sheeps, so easy to be stirred around instead of rising to fight.

  • 2

    alladin

    Yah, a tax hike so the government of Japan can collect more money to give away to other countries while watching their own citizens suffer on a daily basis!!

    Im sure after April 1, there will be a whole lot more people not wanting to shop much anymore. Heck, they will all probably stop spending much money on useless eikaiwas that don`t do much at all but look for ways to take your money while not teaching you much at all.

    It`s so sad, but so very true in every way!!!

  • 12

    inakaRob

    People just don't get it. At the end of the day, you are going to buy stuff you didn't really need. Spent more than you would have initially on a purchase, or buy so many extra stuff some of it is going to go bad or unused, surely more than 3%. It makes MUCH more sense to just curb your future spending. I have already turned down my hot water heater a touch. Trying to turn down my kerosene heater by 1 degree and bundling up a touch more. Putting my computer to sleep more often instead of leaving it on to run to the store. Being more carefull about leaving lights on. I cam guarantee you I am going to save more than 3% in total income next from this April just trying to consciously waste less. Instead all the people go out and buy MORE.

  • 1

    Onniyama

    inakaRob. Great advice!

  • 1

    Disillusioned

    I'm pretty much with everyone else. It's not gonna make much difference. It's just another Japanese sheeple act. Remember after the earthquake when everyone went crazy buying and hoarding water? It's the same thing.

    Just a little further on inakaRob's post: putting your computer to sleep does very little. It is best to unplug all of your electric devices when not in use. You will save up to 10% per month on load.

  • 3

    Spanki

    I'm gonna spend as much money on beer as I possibly can before April 1st.

  • -1

    nigelboy

    Remember after the earthquake when everyone went crazy buying and hoarding water? It's the same thing.

    That's not what I remembered for people were buying bottled water in an orderly manner adhering to the limits set by the shop. Or I do remember people lining up in an orderly manner when Minicipal government was handing out water as well. People do tend to forget that logistics were paralyzed and the supply was running short. In this case however, this is no different than majority of the people doing "last minute" shopping for X-mas or filing your tax returns.

  • 2

    bogva

    I am not concerned about the tax rise but for the way companies are using it to rise prices!

    I can see it everywhere - they plan not only for the 3% up but some more (rounding) so its more like 10% up.

    Same like airplane tickets - when fuel is up - rise surcharge. When down - wait and see (because their stock was purchased at higher prices, huh).

    And cushion is for the corporations, banks and fat rats right? Average Joe has to swallow everything!

    The buying spree is not worthed. Better wait for the things to settle IMHO.

  • -1

    FruitsBasketFan

    That is a tax hike????

    Pfft

    Do not make me laugh!!!!

    Try paying 20% tax on goods (except grocery and children clothes).

    My God, Japanese have it so lovely.

  • 3

    cleo

    Try paying 20% tax on goods (except grocery and children clothes).

    My God, Japanese have it so lovely.

    Try looking at the full picture. Prices here are generally higher to start off with; to give just one example, my favourite skin cream costs just £10 including VAT in the UK, the exact same item by the exact same firm costs ¥2310 including shohizei here in Japan, set to go up to I reckon a little over ¥2600 from April. The exchange rate is around ¥170/£1.

    A Kindle Fire HD on Amazon is way cheaper in Japan (£119 vs ¥12,800), but that's not something you buy every day. Or even need to buy at all.

    So let me see, lower prices on almost everything plus tax-free food, or higher prices on almost everything including food with tax. Gosh, I wonder who's getting the better deal.

  • -1

    fxgai

    The tax rise is seen as crucial for bringing down Japan’s debt.

    It's not going to though, the debt is just going to increase a little more slowly. But it's better to do something than nothing, when careening towards a precipice.

  • 1

    Viki Lyn Paulson-Cody

    I know my friends in America are paying higher tax 15-18% but necessary staple food and so on are not taxed. Each 3% rise seems small but for a retired family or someone like me who has gotten my salary reduced over the past 20 years with not one pay raise it is difficult! 3% up on a ¥5,000 bag of rice is a jump. When you also add other groceries... Tolls on highways are going up too but it won't be just 3% as they will round up to make it even. I use the highways four days a week to go to work. A full tank of gas will go up by 285 yen. For me that's two- three times a week... Plus notices that my water, gas, electric, mobile phone etc all going up... It's easy to be worried

  • 1

    Ramzel

    Spending $2000 to save $60, doesn't make much of an impact.

    If you're buying a car or house, then it makes a large impact. Eg. save 3MJPY on a 100MJPY house or 300,000 on a 10MJPY car.

  • -1

    Laguna

    Electric toothbrushes ... are selling fast....

    Add 3% to the price of an electric toothbrush and you'll usher in the Apocalypse.

  • -1

    John Galt

    " Add 3% to the price of an electric toothbrush and you'll usher in the Apocalypse."

    If it were only on electric toothbrushes I'd be inclined to agree, but it isn't. It's on EVERYTHING that you buy. An instantaneous 3% burden on every person's budget.

  • 1

    bruinfan

    @Cleo, good comment--you called a spade a spade, and many people still don't get what you said here in Japan. Above this is the fact that this money is not going down to pay the national debt, as some had hoped, but will be used for the Tokyo Olympics construction (much of which is unneeded), and yet other wasteful "stimulus" construction spending.

  • 2

    Open Minded

    How high have been the prices in Japan if still after almost 20 years deflation they are still almost twice vs. the rest of the world with some inflation???? FOREX cannot explain everything. Some people/companies must be very rich in Japan having made huuuuuge margins!

  • 0

    Serrano

    I bet all the people living in the Homat apartments don't give a hoot about the tax hike.

  • 0

    isoducky

    Big issue here. There is a surplus of talented people so companies have no reason to raise wages, in fact they could get away with lowering them for the new hires. Wages increase when there are companies competing for skilled labor. The tax hike is intended help finance the pension, insurance and infrastructure areas. These are the most cumbersome, wasteful, and corrupt sections of any government. Save your money while you can.

  • -3

    smithinjapan

    Serrano: "There should be mass protests against this ridiculous tax hike."

    yeah, but they'd be limited to 40 people and in places no one would notice, if people were actually not so complacent and decided to protest in the first place. As it is, Hindu cows, baby.

    It's interesting to hear the rush of certain government to tout a drop in joblessness, and talk about increase in spending, etc., just before this potentially catastrophic increase occurs -- like the chickens have all been counted before the eggs are laid, in order to tout Abenomics in promises it has not been able to keep. Well, okay, to be fair, Panasonic employees are now getting 1000 yen more a month or so than they were before while they'll pay at least 18 yen more a day for their lunches if they don't eat out, but hey.

    In any case, Ms. Oguma isn't going to stop buying clothes after the tax hike, and in terms of clothes and things like that (unless she's sporting brand names that cost a fortune... which really wouldn't surprise me) the tax hike won't hurt a whole hell of a lot of until the increase in consumer goods also goes up and sizes for necessities like food goes down further. For major appliances, electronics, or other goods/events that cost a fortune I can see it. In many cases it can be quite frustrating, though. I have more than one good friend who ordered cars quite some time ago, but because of the sudden surge to get them before April since the time the tax increase was confirmed, they were told they might not get them on time (ie. before the first). If they get them before the first, they will pay the amount agreed upon in the signed contract. If not, they will have to pay the increased tax upon reception. There is no option to cancel the contract based on delay if they receive it after the agreed upon time. It's ludicrous.

  • -4

    falseflagsteve

    Great jib being done by Abe and his chums. Due to Abe's policies it is easier to make money in Japan especially for English speakers. The weakening of the Yen is fantastic for Japan and when inflation kicks in and debt lowers, even better. Next up is to get more nuclear reactors up and running to ease the reliance on imported energy.

    Japan is coming out of the doldrums in style, great job Mr abe!!

  • 3

    bicultural

    Panasonic employees are now getting 1000 yen more a month or so than they were before while they'll pay at least 18 yen more a day for their lunches if they don't eat out

    Panasonic employees got more than than but I'll leave it up to you to figure out how much. Also, 600 yen for a lunch box from home? If you pack your own lunch it should cost under 200 yen. If not, your wife needs some tips from mine.

  • -1

    nigelboy

    .

    I have more than one good friend who ordered cars quite some time ago, but because of the sudden surge to get them before April since the time the tax increase was confirmed, they were told they might not get them on time (ie. before the first). If they get them before the first, they will pay the amount agreed upon in the signed contract. If not, they will have to pay the increased tax upon reception. There is no option to cancel the contract based on delay if they receive it after the agreed upon time. It's ludicrous.

    ??? Each make and model had basically a set number allocated for "orders" to coordinate the production turnaround. For popular models, the order period expired as early as January and for some, early March. The delivery time doesn't matter.

  • -3

    smithinjapan

    nigelboy: "The delivery time doesn't matter."

    It does. Due to massive orders and also inclement weather in the Kanto region, for example, some people have been told they may not receive their cars until after the tax hike kicks in, and will have to pay the additional three percent tax. They cannot cancel. The contract time does not matter, the reception time does. The point is that they were promised cars before the tax hike and agreed to sign a contract based on that, but are now being told that the company may not be able to stick to that contract, but they must, and pay more if the company cannot pull through with its promises.

  • 1

    nigelboy

    It does. Due to massive orders and also inclement weather in the Kanto region, for example, some people have been told they may not receive their cars until after the tax hike kicks in, and will have to pay the additional three percent tax. They cannot cancel. The contract time does not matter, the reception time does. The point is that they were promised cars before the tax hike and agreed to sign a contract based on that, but are now being told that the company may not be able to stick to that contract, but they must, and pay more if the company cannot pull through with its promises.

    It does not. If there is a "contract" in place, there is already an agreed price in place. This is why the dealerships have been advertising the expiration since last year. The dealerships had already set the expiration dates for "orders" and it varied on models. This is common knowledge for people who were thinking of purchasing autos.

  • 1

    kickboard

    The contract time does not matter, the reception time does.

    Actually, you're half right. It's not when you sign the contract, not when you receive the car, but when the car is registered. If the car is a very popular car and there are none available (it's being made right now), it cannot be officially registered. That means you can reserve it in March but you'll have to pay the extra 3% if the car isn't made and registered in March.

  • 0

    bruinfan

    All I can say is buy things you plan to buy anyway. I went and bought rice and stocked up on other food with a long shelf life, which doesn't take up that much space. The savings isn't going to add up to all that much at 3%, but it's not like it was earning much in interest. Some people were making a run on toilet paper, which I thought was silly, since it takes up a lot of space relative to the savings. Some items especially computers and other technology may actually become cheaper in a few months as stores offer "special discounts" to counter the greatly reduced demand. Some food may become cheaper as well after a few months. Maybe the JA effect and middlemen costs will decrease, but who knows...

  • 0

    Serrano

    I have to wait a month to have it delivered, but I bought a washing machine today to replace my over 20 year old one. It was about 20,000 yen cheaper than the old one! Thinking about replacing the 18 year old microwave and the 22 year old fridge, but, heck, they're both still going strong, heh heh

  • 0

    gaihonjin

    SerranoMAR. 28, 2014 - 07:31AM JST There should be mass protests against this ridiculous tax hike.

    I don't know how serious you are, based on your recent comment history. However, other people seem to agree with you and that means there are some who are really unaware of the enormous fiscal crisis Japan faces, right now.

    For a very informative primer, check out the video called "Japan's Debt Problem Visualized." It can be easily found with a search on youtube.

    The sad fact is, the tax hike, while needed, will likely only serve to buy some time before the cost of Japan's debt drives Japan to default.

  • -1

    Strangerland

    I don't know how serious you are, based on your recent comment history. However, other people seem to agree with you and that means there are some who are really unaware of the enormous fiscal crisis Japan faces, right now.

    The problem is that it's almost guaranteed that the additional income will not be used to pay down the debt. That would require fiscal competence on the part of the government. Of course we won't know that for another year or so, but if the debt hasn't increased by this time next year, I'll be absolutely amazed.

  • 0

    Serrano

    "SerranoMAR. 28, 2014 - 07:31AM JST There should be mass protests against this ridiculous tax hike.

    I don't know how serious you are, based on your recent comment history. However, other people seem to agree with you and that means there are some who are really unaware of the enormous fiscal crisis Japan faces, right now. "

    Oh, I'm well aware of the enormous fiscal crisis Japan faces. The big problem is government spending is out of control.

Login to leave a comment

OR
  • Program Assistant

    Program Assistant
    Temple University, Japan Campus - テンプル大学ジャパンキャンパス、Tokyo
    Salary: Commensurate with experience plus transportation from/to TUJ
  • Recruitment / HR Generalist

    Recruitment / HR Generalist
    Temple University, Japan Campus - テンプル大学ジャパンキャンパス、Tokyo
    Salary: Commensurate with experience plus transportation from/to TUJ
  • IELTSインストラクター

    IELTSインストラクター
    Berkeley House Language Center / バークレーハウス語学センター、Tokyo
    Salary: ¥3,500 / Hour Negotiable
  • Bilingual Administrative Staff

    Bilingual Administrative Staff
    Star Kids International Preschool、Tokyo
    Salary: Salary negotiable Depending on experience
  • TOEICインストラクター

    TOEICインストラクター
    Berkeley House Language Center / バークレーハウス語学センター、Tokyo
    Salary: ¥3,000 / Hour Negotiable

More in Business

View all

View all