Noda to press ahead with tax rise despite 9 DPJ lawmakers leaving
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46 Comments
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-2
some14some
so how much increase in revenue do they expect with shrinking sales?
0
Ted Barrera
This will go towards TEPCO and whaling "research"... (-_-)#
-2
tkoind2
Noda is finished. This will kill off his popularity, as it should. The revolving door is gearing up for another change. Noda is just to foolish and self absorbed to realize it yet, but the writing is on the wall.
5
theeastisred
No choice but to raise it, unfortunately. Unusual display of realism and resolution by a Japanese politician on this. Well done Mr Noda.
3
GG2141
Are they going to be smart about it and only raise taxes on non-essential items?? (exclude childrens clothes, heating oil, education, housing and food)
-5
2020hindsights
This is good news. Shame on his own party traitors.
Bad idea. Overly complicates the tax system and is too arbitrary.
-3
Elvensilvan
So the taxes on the now-over-priced cigarettes are still going to get higher?
By the way, Mr. Noda ... now that you have taken the knife to kill your political career, can you also fix the current flaws in the police recruitment psychological screening? Too many unstable young cops on the loose nowadays.
2
LuckyLangers
Damn right they should raise the consumption tax. The country is broke, pension system is broke. And while you are there Noda cut back your government defense spending too. This might help ensure a future for this beautiful country?
3
Foxie
Japan has so much money, no need to raise the consumption tax. Buy a few more of those fighter planes too whilst you are at it.
3
tkoind2
Those in favor of raising it consider the following.
17% of people in Japan live in poverty. As much as half live within bare means. Raising taxes means essentially raising prices on everything for these people. The result of which will be compressed spending for many and significantly reduced spending for others. A tax raise will burden these people and will certainly have results on overall consumer spending.
Reduced consumer spending will cost jobs. Already companies are cutting jobs due to diminished consumer confidence and spending. More pressure in this area will result in greater loss of jobs. That results in greater tax burden, thus neutralizing any net benefit of raising taxes.
Essentials must be exempt in order not to further burden the growing aged and impoverished segments of society. A complext tax system in this case is unavoidable if we are to spare already poor people and those on pensions from even greater poverty.
Foreign business is already fleeing Japan's high tax and cost base. This will, without doubt, encourage more to look to other regions in Asia to establish their home offices and to place jobs.
0
tkoind2
What is really needed to sort out Japan.
Many economists have been saying the same thing. We need more middle class people spending money. So how does this happen in a nation with growing unemployment and poverty? Again the answer is obvious. The nation must begin a Japanese variant of the "New Deal" which would, in the near term, raise government spending as it kicks off job creation projects centered around the renewal of infrastructure nation wide. Everything from train stations to schools, hospitals and roads to be improved as job creation opportunities.
Economists theorize that this would lead to greater employment thus growing the tax paying sector while reducing the state dependent segment.
If done properly it would invite labor into the country who would also become part of the tax paying foundation. Younger skilled and labor level workers could contribute to supporting the aging population while driving forward spending as they work and establish themselves in Japan.
The last thing Japan's economy needs today is a tax rise that will harm spending. It is a death sentence for jobs.
0
BurakuminDes
Noda is a bumbling and uninspiring PM who will be very lucky to see out spring.. Less than mediocre, much the same as all his predecessors. I agree with him here though - where do these critics and opposition think all the extra revenue will come from? One of the only other options would be to slash tens of thousands of lazy public servants (people will jump up and down over that too) and sell off remaining government companies ie their half of Japan Tobacco.
0
BurakuminDes
...or revise the income tax system - can't see the poll - driven politicians here having the guts to do that either.
0
BurakuminDes
>
Good points tkoind2 - however why not have an exclusion on essential goods ie fruit/veges/milk/rice etc like they did when they introduced the 10% GST in Australia, to protect the poor?
0
BurakuminDes
@ tkoind2 - woops I didnt read your point 3! Agreed!
0
cactusJack
Raising taxes is a very non-creative solution to rising national debt and should only be done as a last resort. Have all other avenues been researched and investigated?
0
Cricky
Collected taxes are pooled into a sieve, money pours out creating a need to pour more in. Fix the sieve first! Encourage subsidized businesses to adopt better business practices ie make a profit.Overhaul education, farming, construction, take pratical steps to improve the birth rate. Raising taxes is a very short term fix that will be squandered as usual. Change is natural embrass it or begrudge it, it still happens.
1
MaboDofuIsSpicy
This is only good for young people.
-1
just-a-guy
My congraduations to japanese taxpayers! They are contributing more to their country under DPJ's leadership. This is how 'patrioticism works!
0
tkoind2
"This is only good for young people."
The new deal jobs would largely benefit young people. But the resulting increased tax base would benefit the elderly and poor.
1
m5c32
With barely 50% of next year's budget covered by tax revenue (the deficit covered by bonds) something had to be done. I mean, you have two options, slash the budget by 50% or increase tax revenues. Scuttling f-35s and bullet-trains-to-nowhere are not going to cover that black hole of a deficit.
-2
smithinjapan
"...and rein in the public debt."
Sorry, it's GOVERNMENT debt, imposed on the people BY the government. Try reigning it in by spending less on moronic public works projects, for starters.
1
johnnyG
It's a needed tax increase, but it should happen a year earlier than 2013 and 2015. A big "pro" of the consumption tax is that cash businesses cannot cheat on it. It's been a while since I've heard the phrase, but 10-6-4 used to be well-known. Salaried workers pay income and residence tax on 100% of their salaries (10), others pay on 60%, and folks like farmers only get taxed on 40% of their total income.
A consumption tax also assesses the post-retirement group--a big group--that would otherwise be paying very little on their pensions. Yes, it can be looked at as effectively a tax on pensions, but perhaps it's either that or no pension at all--Japan going the route of the PIIGS, along with major economic disruption.
0
JBinJapan
Big mistake PM Noda...The government in Canada introduced a consumption tax in the late 80s (against public interests and wishes). It has not led to better pension or health benefits, or reduced debt. All it did was needlessly increase the cost of goods and services to Canadians.
5% is more than reasonable. PM Noda should be looking at promoting more entrepaneurship, lower taxes on investments and middle income earners, and openning Japan up to more foreign investment. Taxation doesn't lead to economic growth.
0
johnnyG
Well, it specifically is not a (raised) tax on investment (earnings/dividends/entreprenerialship, etc), it's a tax on consumption, which hits everyone. Two, it spares an income/residence tax rise burden on middle income earners (and other income earners, a shrinking population), instead spreading it (importantly) to those over 60/65-aged consumers who would otherwise be getting a kind of free ride.
0
iceshoecream
Will I, as a foreigner, ever see any of that money if I decide to stay in Japan for the rest of my life?
0
johnnyG
If you're young enough to have paid in the required number of years (given your birth date), then yes, you will collect.
Given the solvency of the system, this kind of tax increase will help. A lot. Japan needs to address its debt/GDP ratio, and the bump up in the consumption tax (for the overall population) will help a lot more than a bump up in the income/residence tax (for a smaller segment of the working population).
0
Hikozaemon
It's very simple - the DPJ was elected on a number of policy promises which included not raising sales tax during its first term.
PMs Kan and Noda, both finance ministry lapdogs, have broken this election promise. The people leaving are leaving because it violates the promise upon which they were elected.
If the DPJ is going to let its agenda be set by burocrats, and is not going to consider having policies and keeping electoral promises important, then we might as well just dump them and go back to the LDP, who are much more experienced at running government that way.
The DPJ under Kan and Noda has become just a watered down version of the LDP. Completely pointless having them in power.
0
Patrick Hattman
**Noda to press ahead with tax rise despite 9 DPJ lawmakers leaving **
He can press ahead in this futile attempt all he wants, or at least give the impression he is sincerely doing his best.
But he will probably find himself scurrying back to the comfort of the DPJ fold not too long from now, while some new hack controlled by the bureaucrat/party puppet masters is put forth as the next "leader" to right Japan's economic ship.
Change the name(s) and install similar headlines in 2012.
0
Frederick Gundlach
Taxes affect relative prices. This means that some of the increase will be borne by the seller. Not always by the buyer---even though "8%" will appear on the receipt.
If the money is used for social welfare spending---especially, if it is used to support the Japanese pension system---then the benefit of increased government spending may outweigh whatever depressive effects a tax would have.
Most modern countries have 15% or 20% taxes to support their old age and pension disability system. In America, it's 15.3%---but it comes out of payroll, so no one "sees" it. They just see the half that is labelled "FICA".
It is good to see that Noda is doing the responsible thing, finally, after Japan kicked the issue down the road for 20 years.
-1
tmarie
Pension and health care?! Why to look after all the old people who don't contribute much anymore. Why nothing for the future like education, daycares, job creation and cutting the debt?! Indeed it will line the pockets of those in charge and money will be spent on TEPCO, useless construction and the like. Funny, I thought the purpose of the tax hike was for tohoku! Bye bye noda. Don't let the door hit your butt too hard.
0
cleo
Yes, no reason at all to give any support to the people who have spent their lives paying into the system - blood, sweat and tears as well as taxes and pension premiums. Bring back obasuteyama.
Not a Christian or a big fan of the Bible, but it does have some gems in it - like, Honour thy father and thy mother, that thy days may be long
0
tmarie
Sorry Cleo, what payments did the women contribute?! Indeed some if the seniors have done the country well but other have robbed it blind and continue to rot the country. Someone like kikukawa from Olympus for example. Not all have do e their part and many are now abusing the medical system. Invest in the youth not the nearly dead.
0
cleo
Some didn't, and I agree with you that they should not be entitled to the same pension as people who have paid in. People who have paid in should get what they paid for, regardless of gender. Kikukawa from Olympus is one man, not representative of the majority who have done their bit. (I know Kikugawa was involved in dodgy business dealings, but is there any suggestion anywhere that he didn't pay the personal pension premiums he was supposed to pay? If there is no such suggestion, why bring him up?)
In your post you refer to 'old people who don't contribute much anymore', which presumably means you do acknowledge that they have made their contribution. The majority of ordinary people who are now hitting pension age have not 'robbed the country blind'.
0
tmarie
Indeed some have and those smart enough have money socked away. The ones who didn't contribute shouldn't be getting help when the youth of today aren't getting any. I would much prefer my tax money go to them and give them a chance to turn Japan around.
I bring up kikukawa and the rot because these Issa s are the ones running the companies and the country. Many are old hits who only care about themselves and family, not the country or the well being off their employees - like kikukawa. The older generation may have been mostly bar working but their legacy, their mindset and their stubbornness to change is costing this country dearly.
0
tmarie
Tend to fill that one who hasn't paid into the system should get nothing in return. I don't care about gender nor age. Why should you and I support those who don't support themselves?!
0
cleo
Those who have been on an average income (which is most people, that's what average means) and have put a couple of kids through the education system here don't have much socked away. They were told they didn't need to, because they were paying their premiums. And they've contributed a couple of tax-payers to the economy to keep things moving.
0
tmarie
Cleo, how naive does one have to be though? I pay mine, my husband pays his and I certainly don't believe there will be anything left when it comes time from me to take what I paid. Why?! No younger generation to ensure the payments are there.
The guys who worked and paid?! By all means. Those who haven't?! Parasites. Parasites leeching off a broken system that promised them faaar too much. There is no reason why someone who hasn't paid should be claiming. Get rid of the housewife 1.3 crap, help only those who need it and raise the retirement age to 70. Put money into daycares, getting women into ft jobs (tax them like the men) and start over as the system here is doomed.
0
cleo
But you don't want kids, and you don't want the system made easier for people to have kids....
0
Michael Craig
Considering what the DPJ turn into under Noda, I don't blame those 9 guys for qutting! Good for them!!
0
tmarie
I don't?! News to me?! I've suggested more day cares and better opportunities for working women Cleo. How is that not supporting?!
0
unreconstructed
smithinjapn
"Sorry, it's GOVERNMENT debt, imposed on the people BY the government. Try reigning it in by spending less on moronic public works projects, for starters."
You are all for pork and boondoggles when it's Obama and the Dems forcing them on America. Why the double standards...
0
cleo
No support for families who choose to care for their own kids. Your 'better opportunities' are only opportunities for women to work like men. What society as a whole needs is more scope for men to be able to work like women and for both parents to spend more, not less, time with their kids.
0
tmarie
Where have I not supported them?! Stay home uf they want but don't expect the tax payer to foot the bill. Dirty Cleo you're wrong on this. If moms want to stay home, by all means but they better have a husband who can support it as the current system is unfair to those of us who work for a living.
0
tmarie
I've also money be put in education and job creation. You just want to argue when there is nothing to argue about.
0
tmarie
No idea why dirty came up - should say sorry!
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