Tax hike plan gets provisional OK
TOKYO —
The government panel on tax reform on Friday approved a plan by the ruling Democratic Party of Japan, which includes raising the consumption tax to 10% in two stages by 2015.
The approval comes following Thursday night’s decision by Prime Minister Yoshihiko Noda to hike the consumption tax from the current 5% to 8% in April 2014 and to 10% in October 2015.
Noda had been pushing the DPJ to reach a consensus on the issue by the end of the year.
However, at least nine DPJ lawmakers have said they will quit the party over the decision, while the opposition Liberal Democratic and New Komeito parties have demanded that Noda dissolve the lower house and call a general election next year to decide the issue.
Noda told reporters on Friday that the consensus among the tax panel is a step forward and that the government will do its best to have thorough discussions with the opposition parties so that a relevant bill can be submitted to the Diet before the end of the current fiscal year on March 31, Fuji TV reported.
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1
Shumatsu_Samurai
I just hope that this reform is maintained in the face of the opposition to it. It's important that Japan increases its tax take. The Economist states it is only 17% of GDP, lower than the rest of the OECD.
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minello7
I wish someone would make a concrete decision, http://www.japantoday.com/search?q=consumption+tax+ Even the BBC reported Mr Noda had changed his original plan of increasing the consumption Tax.
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presto345
That's right. The original plan was to raise the tax to 8% by April 2013.
The government certainly needs more tax revenue, but I think spending cuts are lagging and that's what is making the planned consumption tax hike so unpopular.
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Ranger_Miffy2
Tax hike gets my unprovisional FAIL.
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johninnaha
Why only 10%?
They're doing such a magnificent job, surely they deserve more.
Run it up to 50, 60% and use the money to give politicians and government workers huge bonuses and long holidays.
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cdiki77
Instead of hiking the tax govt should decrease the high salaries of high officials and stop wasting money on useless projects
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Patrick Hattman
The timing of this is perfect for the DPJ. Noda will take the fall in the never-ending succession of puppet PMs. But it will get done. Come back to the issue after about 10 years and we'll see what sort of impact it has had on Japan.
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globalwatcher
Every politician who raised tax is doomed in history. However, this needs to be done sooner or later. He is coming up with public spending cut over civil servants and rural politicians as I understood correctly by reading his blog. There are too many civil servants and rural politicians who are on government payroll right now, and they need to be cut.
No other Japanese politicians have ever done these in history at the same time. Hope someone like Noda bites a bullet and says "Buck stop here". He is simply inherited the mess LDP has created over 5 decades.
I believe he became a PM in wrong time trying to accomplish the hardest objectives while he is trying to stimulate economy for many unemployed and restore Tohoku.. If something is not done now, Japan will be doomed within 3 to 5 years.
I just hope this tax hike is only for consumption excluding food and medicine.
Good luck, PM Noda. You are simply executing the most hated and unrewarded jobs in J. history. I take my hat off for you, PM Noda..You've got my respect.
-1
nisegaijin
no government has ever spent or taxed to prosperity. last thing i will buy with 5% tax rate is my one way ticket out of here.
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globalwatcher
<<i will buy with 5% tax rate is my one way ticket out of here.
If your one way destinaton is USA, you have a few states to avoid consumption tax. My state consumption tax is 7.6% that is not too bad compared to other states. Not only that, you are not including a relatively higher payroll tax than Japan. FYI
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