business

Polled economists say Japan should raise sales tax above 10% to fund welfare costs:

21 Comments
By Kaori Kaneko

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

© (c) Copyright Thomson Reuters 2018.

©2019 GPlusMedia Inc.

21 Comments
Login to comment

Next October's planned sales tax hike will hurt the economy in the short term, economists said, predicting a sharp 3.2 percent annual rate of contraction in the fourth quarter and growth of 0.4 percent in the first quarter in 2020.

Be it lasts longer, and not to mention the "spike" that will come prior to the rise!

1 ( +1 / -0 )

This economic crisis is the result of a whole generation of Japanese putting short term economic gain ahead of long term planning by working hard but having a very low birthrate. Now many of those aged parents don't have adult children to care for them and collectively there are not enough tax payers to support the elderly and the rest of govt budgetary needs.

Let this be a lesson to us all. Bearing children is not only a beautiful thing but it also helps ensure there's someone to care for you when you age and contributes to an economicly healthy society. Any society that minimizes and fails to support parenthood and childbearing will eventually have hell to pay.

3 ( +5 / -2 )

20 plus percent consumption tax and mass immigration creating what will be second class citizens under the law? Sounds like a great idea. And all to prop up a scheme that clearly no longer works and will eventually collapse no matter how much they destroy the country trying to prop it up.

That's part of the problem with pampered boys like Abe. The older generation just want their old age to be as comfortable as possible until they die. Who cares about the younger generations, right?

2 ( +2 / -0 )

Out of 32 economists polled, 23 said it should be raised above 10 percent.

Let me guess, the 9 who disagree are not on the government payroll at public universities? Beyond some basic truths about supply/demand and comparative advantage, modern economics is largely a pseudoscience. Imagine if only 23 out of 32 doctors agreed that smoking is unhealthy, or only 23 out of 32 astronomers could agree on the earth's distance from the sun.

2 ( +3 / -1 )

Probably they should reform the heath care system and making it a bit more consistent and only for serious issues, like in the rest of the world: there are more clinics, dentist and medicine stores than convenient stores in Tokyo. Dentists asks you to go at least 3-4 times to do a job that abroad it takes one quick session, just to receive from the government the 70% free-of-charge that the patinet pays with the insurance); people sldo keep on frequenting hospitals and clinics for a cold just to have for free even the basic medications they could buy at every corner relatively cheaply; no action taken on a systematic level to reduce pollen producing trees in Japan, which doom half of the population in Spring and other seasons, charging again the health system. Politicians in this country are incompetent: the only think they can do is taking money and rising taxes (and asking US support, when China step on their feet).

6 ( +7 / -1 )

What welfare ?

-1 ( +1 / -2 )

Or they could just cut back spending on so many useless things. Just a thought. But hey while we're talking about taxes, don't stop at 10%, lets just make it a cool 100% rate. Because it's fun having to pay double the price.

2 ( +3 / -1 )

people sldo keep on frequenting hospitals and clinics for a cold just to have for free even the basic medications they could buy at every corner relatively cheaply

I stopped by a drugstore the other day looking for melatonin--no, she said, you have to get a prescription for that. For melatonin!? Decent painkillers, nope. Good allergy medicine, nope. I understand we don't want meth-houses in Japan, but the routine medications that you have to visit a doctor for in this country are what irritates me.

5 ( +5 / -0 )

I think sales taxes will continue to rise quite a lot globally. They give you a nice broad base that is hard for people to avoid especially if there are no carve outs.

A 1% hike can make a significant different to government budgets.

Especially as it seems its still all too easy to dodge company taxes in an age where we see the development of these mega multinationals with operations around the globe. Plus you have this global race to the bottom to offer tax incentives, subsidies etc for setting up business.

Ireland is a prime example. Singapore another one.

If you're a government with an aging population, like virtually all of them are now (apart from Africa), then you have to raise funds somehow. I think sales taxes and automation taxes will be very much in vogue going forward.

1 ( +1 / -0 )

Sales taxes are very easy to collect and efficient. They penalize the poor, but countermeasures can be taken, like leaving them off essentials.

In answer to "what welfare?", if you have an under three in public childcare and pay 30,000 yen a month, you are getting welfare to the tune of at least 100,000 a month. For a baby, it will be closer to 150,000 a month. That's a lot of welfare. I'm not against it, only the idea, which some people have, that 30,000 a month is somehow enough for someone else to look after a baby for 200 hours with meals provided. Someone else is paying and that money has to come from somewhere.

Pie charts show that welfare costs the Japanese government way more than infrastructure, the bridges to nowhere. Japan could stop all infrastructure spending and still have a massive deficit.

2 ( +2 / -0 )

Corporations recently got a tax cut even while they were raking in the highest profits in modern history. Rescind these cuts and lessen the burden on consumers, since our spending accounts for 60% of GDP, while corporations are using much of their windfall on share buybacks and higher dividend payouts.

6 ( +6 / -0 )

Every time there has been a rise in the consumption tax it has been for 'welfare', but afterwards the money is always used for something else.

4 ( +4 / -0 )

Welfare? Really? Or miltary?

4 ( +4 / -0 )

Do as other countries do, higher basic consumption tax, but exempt food, baby and childrens' goods, education materials, medicines, and a few other deserving items, so that those with lower incomes are not hit with a massive burden.

3 ( +3 / -0 )

Slap these economists! The original 3% sales sales tax hike was supposed to subsidize the welfare and pay off the national debt, which never happened and has been quickly forgotten. The further 2% increase has been earmarked for the same purpose, which is very doubtful. Now, these idiots want more sales tax to support welfare? I’m in my 50’s and am already paying over 40% of my salary in taxes, health insurance and pension, plus the soon to be 10% commodities tax. Where the heck do my taxes go? The local city hall is a derelict and filthy building. The parks are never maintained. The roads are a flipping joke. Half of the streets still have no lighting. Yet, these wankers have just increased city tax by 3%. I’m sure the vast majority of the taxes people pay are only used to pad the salaries of those with enough seniorority to enforce a tax hike.

4 ( +5 / -1 )

Once the sales tax reaches a threshold the black market will expand and defeat any future gains. Japan needs to follow the money: big corporations, old people and real estate owners.

2 ( +2 / -0 )

Cut the number of Diet members by half. Think of all the savings. Their salaries, their staff salaries, all the housing allowances in Tokyo for members and staff, their transportation and other expenses, their cushy pension plans, etc, etc, etc. ...

1 ( +1 / -0 )

I think they should make a 15% sales tax on luxury items like Starbucks coffee , LP records and any clothing which costs above 5.000 yen.

0 ( +0 / -0 )

I think they should make a 15% sales tax on luxury items like Starbucks coffee , LP records and any clothing which costs above 5.000 yen.

You already have luxury taxes ya? Like taxes on sports cars and alike.

0 ( +0 / -0 )

"some recommending it should be over 20 percent."

Oh sure, go ahead, raise it to 20%. Kill the economy, watch tax revenues plummet. Oh my...

0 ( +0 / -0 )

This is a warning to young people. Get married and start making babies, or we will make it more costly than getting married and making babies.

0 ( +0 / -0 )

Login to leave a comment

Facebook users

Use your Facebook account to login or register with JapanToday. By doing so, you will also receive an email inviting you to receive our news alerts.

Facebook Connect

Login with your JapanToday account

User registration

Articles, Offers & Useful Resources

A mix of what's trending on our other sites