Auto company execs, unions, dealers demand lower taxes

What goes around comes around. Japanese manufacturers are feeling the crunch of indiscriminate taxes by the government in a misguided effort to stimulate the economy.

Once the government adds or raises a tax they are wont to giving it back.

Taxes are a plague on society given to a government that has no idea how to use the money wisely.

And I can not believe I used the word wisely and government in the same sentence.

It is pretty ridiculous in Japan. I have an excellent car but having to do "Shaken" every two years plus hefty road taxes is just symbolic of the bureaucracy and greed here in Japan.

You could easily hit a 1 Million yen bill if you had to do lets say...Shaken plus you need to replace your rotors and brakes on your vehicle, plus road tax. Don't think cause you are driving a K car that you will get off easy. Greed has no jurisdiction. That's enough for a down payment on a new car that would be trouble free for 3 to 5 years.

Whats the deal with taxes? 100% of car taxes are earmarked for the Department of Unnecessary Road Works? (as I recall)

so you want a enviromentally concious society and another 90,000 cars on the road? Wow. Miracles still exist in some peoples minds.

yes, yes, and yes. i was bowled over when i read that the taxes we pay are more than we pay for the car!!!!! if i didn`t live in rural area that car would be gone gone gone.

The government here collects lots of Taxes and misuse it somehow, but slowly they are wiping out industries and chasing away Jobs. Raising of sales Tax will even make it more difficult, and people have lost confidence in spending with time.

I kinda understand what they are getting at but imports get hit the same.

I have been saying for yrs on JT that govt & its beaurocracy are hugely parasitic on the country, it is killing Japan & has been bigtime since the end of the 80s. Why the hell everyone in the 80s was saying the beaurocrates in Jpn were great was always totally baffling to me, they were then & are now digging the countries collective grave, the amount of waste & outright theft is collosal in scale.

Sadly 3/11 wasnt big enough to change their ways & they look set to dig us down even faster.

Now if you want to save on yr shaken just go to these city shaken centres, I recently did my estima there for just under Y70,000(all taxes & forced insurance), if I did it at my dealers garage it wud have been Y150,000 at least. Its still highway robbery but you can cut it some if yr willing.

smithinjapan..¥200,000 PLUS parts and labor. You can't honestly tell me the mandatory fee is for 'safety'

I have owned all types of cars in Japan for many years and have never paid anything close the the figures you are quoting. I currently have an older Crown Majesta which the last JCI inspection and insurance came came to a little over 120,000 yen. The majority of that was for weight tax and the compulsary insurance. The garage that did the inspection charged 8000 yen. Annual road tax is about 55000 or so. My wife has a Move K-car that the yearly road tax is 7500 and the inspection/insurance is 45,000 yen. Manditory fee? Someone is ripping you off.

Japan’s Vice Finance Minister Fumihiko Igarashi said cutting car taxes would involve a reduction in government revenue and be difficult to do “because there is no other form of tax income to make up for it,”

Right, so they can't actually find a way to work for efficiently. Are we supposed to believe that they are already working at peak efficiency? Please.

Japan’s annual sales of new autos have shrunk to about 4.25 million vehicles, falling from a peak 7.8 million vehicles in 1990.

And this figure will only continue to shrink with the trend of young people not having stable employment, older people giving up on driving, and the general hollowing out of the countryside around Japan. While it would make me happy, a car owner, to see the taxes lowered, I seriously doubt it would do much to help reverse the above trend.

Sorry to be the grim reaper, but there are some serious problems facing Japan straight in the face and I really don't see anyone willing to make the hard decisions that have to be made to lead Japan out of this mess they have created.

“Once jobs are lost overseas, it is impossible to recover them.”

Aren't these the guys that decided to build overseas?

I was under the impression that a lot of the money goes to the police retirement association, where there are also probably amakudari prats, a catalogue of private ryokan and other perks for everyone, and bonuses and payouts for the "executives" who manage these "associations".

They might want to coiunt their blessings that import cars are taxed even more heavily and that overseas manufacturers are even more greedy.

A few years back whne UK/JP exchange rate was closer to 200, the cheapest Mini in UK was about the equivalent of 2.3mio yen. Is was being sold in Japan for over 2.5mio yen. Now with the exchange rate at 125 it is still around the 2.5/2.8 mark, but the equivalent cost has dropped to 1.5 mio yen. Mini won't drop price because they "want to protect the brand value" of being a prestige car! Hmmm - lost opportunity? But at least it save the Japan auto industry.

Wow! What a big surprise this is, not! The rich are crying poor! Sounds like a normal day in Japan to me. Car taxes in Japan are a little more expensive than some other countries, but not as expensive as others. Suck it up boys!

Honest to god, what does the government do with all this money besides build roads to nowhere and pad their accounts?? 49 times more than the US? Ouch!

The Japanese shaken inspection program started back in 1951. Back then the cars here were not so durable. Lots of mechanical car trouble in those days. The year is now 2011 and cars are built much better and made to last. Get rid of the shaken. The annual mechanical inspection should suffice.

According to Wikipedia Japan, the shaken costs an average of 60,000 YEN (excluding taxes and insurance).

Japan needs to quickly revitalize its domestic markets and rely less on the fading export market to survive.

Weird.

According to Japan Automobile Manufacturern Association cite, it's lower Than UK, France, or Germany. I know the yen rates haven't gone up that much.

http://www.jama.or.jp/lib/jamagazine/200605/13.html

@NetNinja, You might be surprised to hear this but I actually agree with you on this one :) Shaken is definitely ridiculous without question.

car reaches 10 years since mandatory inspection(Shaken) is switched to once every year from once every two years at this point

This does not apply anymore, all vehicles eligable for a two year inspection get it every two years regardless of age.. this rule changed several years ago.

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Mr. Fumihiko igarashi how to explain to their taxpayers that their government will pay 10.000 free flights ticket to foreigners. Just get out,now!!!!!

@NetNinja.. i had to go to Wikipedia to understand exactly what a "Shaken" is that you mentioned... Wow.. must be rough and expensive to have a car in Japan.. You would laugh at the cars that are allowed on the road here in America... pure junk .. straight from the junkyard to the street, no problem... if you live in the city, then you will need an emission test every couple years... that's about it.

Here is the deal: They get lower taxes if they force the government to have a balanced budget! Everyone wants something from the government so what is it they really want? Follow the money (in every country) to find out what is really happening.

gyiuza, do you know that cars imported into Japan are dutyfree, they are, they just get hit with import consumption tax, which ALL imports get hit with, so look elsewhere for your cost differences, it isnt at the port or airport

And that friends, is why I don't have a car in Japan. Like NetNinja said, having to do "Shaken" every two years plus road taxes, would leave me with no money.

Auto company execs, unions, dealers demand lower taxes

We all do ! So what is new ?

@GW - gyiuza, do you know that cars imported into Japan are dutyfree, they are, they just get hit with import consumption tax, which ALL imports get hit with, so look elsewhere for your cost differences, it isnt at the port or airport

Please check your source again (or quote it here so I can compare apples/apples). Also, I noted the biggest cost difference was currency, but foreign firms are capitalising on that to make more profit. If they reduced prices they could probably clean up the market.

Definitely extend and INCREASE the green car subsidy. Some  compensation should be made to dwellers of rural areas. As for those of you bitchin' about paying taxes, why don't you opt out of the national health insurance, road maintenance etc. programs and then try paying for services that the the gov't subsidizes or pays for outright, including paving the roads you use directly from your own constipated pockets?

The ownership of cars had gone down where mass transit system is fully serviced through out the prefecture and land price is so high that parking rent is as high as rent for a studio flat. Toyko and, Osaka are the only prefectures that are below one car per household beside these two districts the ownership of car is one or more car per household. One of the reason why the number of car sales are down is because people hold on to their car longer than ten years ago so there is a cycle in amount of sales that goes rises and falls at a rate of 10 years. Another point of increased sales of used cars that does not go into the sales survey.People tend to buy a new car is when the car reaches 10 years since mandatory inspection(Shaken) is switched to once every year from once every two years at this point. Shaken itself, if there is nothing wrong with the car, cost only about 3,000~10,000 yen depending on where you go including the do it yourself type although I advise changing the windshield wiper blades and oil.

The taxes are too high because the people want their federal government to run their lives. Everyone knows about wasted money and corruption but nobody says a word. Of you want your country back change the system and develop a true market. They just gave TEPCO 900 billion of your money. Same thing in North America and Europe. Lawmakers are as thick as thieves.

Shaken, we call it mandatory technical control of vehicles in my country and it costs 23 Euro that's 2,472 Yen today. So why do we have to pay such horrendous amounts here? Plus the 36,000 car tax every year. It is pure robbery.

Owning a car in Japan is expensive - and should be - but revenues should be used wisely. Shaken should be abolished, though not the taxes associated with it. I'm sure every car owner has his or her own shaken horror story; it is inefficient and ineffective. As an alternative, police should be encouraged to stop cars with obvious problems such as non-operating lights or other faults indicative of deeper defects.

The highest cost of car ownership for most people is parking; if you lack your own space, renting one will set you back at least 10,000/month, even in my mid-sized town of Kumamoto. That dwarfs all taxes associated with a car. Also, tax revenues lost will have to be made up elsewhere - so, where?

Continue current tax policies, abolish shaken, and strengthen steps towards eliminating inefficiency in government.

Yep, they should drop the shaken system and government just have to force us to buy new car every 3 years. Problems solved!

My wife has a Move K-car that the yearly road tax is 7500 and the inspection/insurance is 45,000 yen. Manditory fee? Someone is ripping you off.

I have two cars, one a Kei and my "shaken" last year for my kei was 30,000 even. Didn't need any parts changed, everything was within standards so I was good to go.

There is now the user shaken as well which people can do at the land transportation office. There used to be a time here when garages doing the JCI would changes all the parts checked in the inspection and the labor and parts together would cost an arm and a leg. Now because of complaints about the costs prices have come down and there are guidelines within what is allowable and not. Like how much pad is left on the brakes, lights, etc etc etc.

God smith. Why do you insist on commenting on things you don't know?

As some had alluded to, the bulk of the shaken is not the cost of inspection per say but it consists of compulsory insurance and taxes based on the weight class of your car paid in every two months.

Governments tend to use the taxation as an ultimate tool to gain control over economy and they have overly high expectation. But taxation is not a miracle clue and it doesn't work that way, though, as taxes only have the power to destroy economy if used unwisely, meanwhile to make the economy better, needs more where taxation can have no more usefulness than being an accessory to stabilization.

Correct that to two years.

At least this avoids uuninsured vehicles.

How about correcting this again to read, every two years AFTER the initial three for a new car and for passenger vehicles only. Trucks, sales oriented vehicles, green licensed vehicles, buses, etc. are inspected yearly and taxes paid accordingly.

However, if you just commute by scooter, you only pay 1000yen a year in taxes. Go figure.

It is very difficult to compare the costs between different countries, because there are many differences in how the tax and insurance is calculated for each car or driver. From my own limited experience I would say the overall cost, means shaken + tax + insurance is cheaper in Japan than in my home country. I can't believe the numbers quoted in the article.

How about correcting this again to read, every two years AFTER the initial three for a new car and for passenger vehicles only. Trucks, sales oriented vehicles, green licensed vehicles, buses, etc. are inspected yearly and taxes paid accordingly.

Sure. If you want to be technical about it. Let's include the two wheelers and rental cars while we're at it.

A large part of the car tax is compulsory insurance. In the UK this is handled by commercial insurance companies. If compulsory insurance were not added included in the tax and were handled by commercial insurance companies, young drivers would find that they could not get insured on really fast cars such a GTRs. That would not help the auto manufacturers.

The purpose of the shakken is not safety, but to provide an income for service station and ensure that people use what the parts the manufacturer recommends.

What really would increase sales more than anything else would probably be the removal of traffic wardens in the cities. A car was useful and practical in Tokyo in the days when you parked, got out of the car and checked the road and car tyres for chalk marks. If there were any chalk marks, you knew the police were checking that road on that day, so you either made sure you parked for less than 20 minutes or moved and found a place with no chalk marks. Many people have told me that it is not worth having a car in Tokyo or, I presume, any other big city. In the country a car is essential, but it does not have to be a new one.

gaijintaveller

the purpose of shaken is not safety..but to insure that people use the parts the manufacturer recommends

90% of it is safety. You disagree with yourself in the same phrase. Using not recommended (not allowed) parts would automatically (and understandably) cancel your insurance. Nowadays modern cars are just not like those from 30 years ago, when everyone could fix it by blowing in the carburettor and kicking the tyres.

Ebisen: while PART of the purpose of 'shaken' is to ensure safety, the main purpose is to ensure funds. If it were merely for safety the car owner would only be charged for parts, where necessary, and labor. Instead, it's ¥200,000 PLUS parts and labor. You can't honestly tell me the mandatory fee is for 'safety'.

As for the rest of it: "Young people are losing interest in buying cars" said it all for me. If they don't want or need them, good, but as is often typical of things that were once popular and/or common place going downhill, the industry is looking for ways to force interest instead of ways to adapt.

I agree that taxes on cars are ridiculous here, but ALL of Japan and industry, more or less, has suffered from the March 11th disasters. Can we all get tax breaks to keep afloat too? Nope, ours are going up in the very near future.

Correct that to two years.

At least this avoids uuninsured vehicles.

The road tax is Japan is not really so bad.

A large part of the car tax is compulsory insurance. In the UK this is handled by commercial insurance companies. If compulsory insurance were not added included in the tax and were handled by commercial insurance companies, young drivers would find that they could not get insured on really fast cars such a GTRs. That would not help the auto manufacturers.

The purpose of the shakken is not safety, but to provide an income for service station and ensure that people use what the parts the manufacturer recommends.

What really would increase sales more than anything else would probably be the removal of traffic wardens in the cities. A car was useful and practical in Tokyo in the days when you parked, got out of the car and checked the road and car tyres for chalk marks. If there were any chalk marks, you knew the police were checking that road on that day, so you either made sure you parked for less than 20 minutes or moved and found a place with no chalk marks. Many people have told me that it is not worth having a car in Tokyo or, I presume, any other big city. In the country a car is essential, but it does not have to be a new one.

govt should raise taxes for these businesses without explanation.