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Japan cautious on capital gains tax; must stick to increasing defence

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Do you want to absolutely crush the average person, because right now the only way anyone below 40 is going to have enough to live off by the time they retire is through investing.

5 ( +18 / -13 )

we might ask everyone to share the burden broadly

The tax raise seems like a done deal already. 2027 is the target I guess.

5 ( +13 / -8 )

Japan should avoid rushing into raising capital gains tax as doing so could send a wrong message to markets when Japan is encouraging financial investment, a senior government official said on Sunday.

The LDP fears sending the wrong message to financial markets but will shove pork projects like the Olympics and memorials down the throat of the Japanese public; and most probably a rise in sales or income taxes.

11 ( +21 / -10 )

Destroy the economy to protect what’s left….makes sense

-2 ( +6 / -8 )

Sure, increase taxes to increase defense spending because Japan lacks the leadership it needs to deescalate and demilitarize. Just total lack of accountability. Not that Japan has much control over its foreign policy with US bases doting the country. Still, it would be nice to see some statesmanship now and then.

-2 ( +6 / -8 )

@Kumagaijin

why would Japan deescalate and demilitarize when it’s neighbors are threatening war. That would put Japan security in peril. Stand up against the bully so that the bully thinks twice of engaging you.

0 ( +11 / -11 )

why would Japan deescalate and demilitarize when it’s neighbors are threatening war. 

Please link to some site where China threatens war.

3 ( +10 / -7 )

unfair tax that favors the rich

Nonsense. Middle income Japanese households have hoarded tons of government bonds, insurance policies and plain old cash, also including foreign exchange deposits. They buy relatively few stocks and other higher-return assets not because they can't afford to, but because they choose not to.

In the meantime, the government has backed and promoted the NISA and IDeco retirement investment programs, on the premise that they will provide decent returns to pensioners make up for the insufficient and stingy state pension. Now, some in govt want to render those programs less effective. Crazy.

Time to move to Singapore?

-1 ( +10 / -11 )

"We must do what we should do regardless of whether there are funding sources or not," Kihara said.

If anyone needed any proof that LDP doesnt give a toss about indebting future generations & fiscal responsibility, here it is. How about you stop warmongering & stuffing your pockets instead?

-1 ( +8 / -9 )

Building up defense , manufacturing killing and war machines is good business and good for the economy. exporting killing machines has made many countries around the world super rich.

-10 ( +0 / -10 )

"why would Japan deescalate and demilitarize when it’s neighbors are threatening war. That would put Japan security in peril. "

Who is gonna attack Japan and for what purpose? China, NK, Russia ?- with the US bases here, any potential " aggressor " has absolutely nothing to gain and lots to loose. It ain,t happening.

2 ( +9 / -7 )

so yes be ready pay by higher taxes to cover jpn military spending,make a few a very rich and rest of plebs poorer plsu make tension in area higher.if you think that China,Korea or Russia will just sit and do nothing about it you mast te be very naive.

no one is going to attacj Japan and Japan is not going to attack anyone as well.Japan is tool in US hands against China,Russia and DPRK...so here we are folks you can see how Japan "loves peace" while many tax payers are having hard time to pay daily life costs bills.

2 ( +8 / -6 )

The LDP just don’t want people to level up economically, invest to cover the failed pension scheme/scam and they have to tax you further for their pet project. I didn’t invest to have a share in a first strike weapon?

7 ( +10 / -3 )

Japan cautious on taxing the wealthy.

10 ( +12 / -2 )

The tax has been contentious since Prime Minister Fumio Kishida swept to power last year pledging to review what is seen an unfair tax that favors the rich earning hefty financial investment income.

I agree with this sentiment. Capital gains tax is very low compared to income tax rate in Japan, especially for the numbers we're talking about. But trying to raise taxes on the rich in Japan is a recipe for unpopularity.

So compare to an individual, an entity that derives income from investments pay less tax, is able to carry a percentage of losses as a deduction etc.

-1 ( +2 / -3 )

I don't understand first Kishida said to invest.

Now Kishida wants to raise capital gains tax.

7 ( +7 / -0 )

Share the burden ??? It's laughable!

We mean we will remain in our corrupt rich little crony bubble while you plebs slave away on minimum wages.

Take the tax increases take whatever we dole out to you !

Disgusting!!

8 ( +9 / -1 )

Your future is always out of your own hands when you are a satrapy.

-1 ( +4 / -5 )

The flat rate 20 percent capital gains tax only favors those loaded with money and very unfair. It must be abolished immediately.

"The question is how to secure firm funding sources beyond 2027.”

The most secure and reliable funding source for the proposed defense budget increase is issuing of government bonds. No need to raise taxes at all.

5 ( +7 / -2 )

They will get peoples support when low and middle income families are exempted from new taxes and those who can clearly afford to pay more in tax, (high and ultra high income earners) are the only ones taxed for Japan's defense needs.

To those saying China will not attack Japan, your daft. China continues to build more ships for it's navy that numerically already has more than anyone else on the planet. They build more nuclear missiles and silo storage in occupied Tibet, (wouldn't want China itself to be targeted for holding nuclear silo's) and it's two million strong army is about the largest on the planet. More fighter gets, more tanks, it never ends. They want overwhelming strength and they continue to build it. It is for war pure and simple and as China expands it is neighbors like Japan and Taiwan that will lose, those in and around the South China sea will lose.

Japan better be ready, and 1% on defense is not enough to dent the juggernaut neighbor.

Spending 2% will not stop them either but just might slow them down and do enough damage to make them think twice. And allow the free world to back up US forces helping to defend Japan.

China wants war. China prepares for war. China wants to win that war. What does Japan want? Life on its own terms or life on its knees at China's terms? Look at the destruction wrought on Ukraine by a stronger neighbor because that could be Japan if China gets its way.

-6 ( +0 / -6 )

More fighter gets

More fighter jets.

-5 ( +1 / -6 )

Well what can you expect when the decision makers last brush with education was 50 years ago, a time when your family name alone gave you a degree.

1 ( +3 / -2 )

Infuriating.

2 ( +3 / -1 )

Do you want to absolutely crush the average person, because right now the only way anyone below 40 is going to have enough to live off by the time they retire is through investing.

The average person doesn't have 100 million Yen in income producing financial investments.

3 ( +3 / -0 )

Yeah, Japan doesn’t want to upset it’s ruling class.

3 ( +4 / -1 )

We are watching the fall of Japan. The elders care nothing for the next generation. Japan will be but another samurai story.

5 ( +5 / -0 )

an unfair tax that favors the rich earning hefty financial investment income.

So the rich that earn hefty financial investment income, pay capital gains tax on it, whereas those who do not earn investment income do not pay capital gains tax…

So, what is unfair about that?

Those who earn the investment income, pay capital gains tax.

Seems totally fair to me, and we should all be VERY THANKFUL.

In Japan, differences between the income tax and capital gains tax rates causes what is known as the wall of 100 million yen

And how many people in Japan actually earn 100 million yen to begin with?

I’d guess it’s less than 50,000.

And these rich people earning that much could take their marbles and go live in Singapore or Malaysia if Japan doesn’t treat them good.

-4 ( +0 / -4 )

So the rich that earn hefty financial investment income, pay capital gains tax on it, whereas those who do not earn investment income do not pay capital gains tax…

So, what is unfair about that?

Some people consider it unfair to tax people who earn their income through actually working for a living at a higher rate than people who earn their income by simply letting their money earn money do.

If it was "fair" these two would be taxed at the same rate.

1 ( +2 / -1 )

If it was "fair" these two would be taxed at the same rate.

Therefore, income tax rates should be reduced to equal the capital gains tax rate?

That would indeed be fair.

Everyone pays a fair square proportional share of income.

Not different, unfair rates for different people.

Or else the people who are on the receiving end of the unfairness will take their marbles and head elsewhere. Japan is a poor country now. It cannot afford to act as if it is paradise on earth any longer.

-1 ( +1 / -2 )

Those who earn the investment income, pay capital gains tax.

Seems totally fair to me, and we should all be VERY THANKFUL.

Except even the real billionaires know this is the symptom of a very sick system when their lowest paid staff pay a much higher percentage of their income in tax than them.

https://www.fool.com/taxes/2020/09/25/why-does-billionaire-warren-buffett-pay-a-lower-ta/

0 ( +2 / -2 )

And in the first place, how many people who earn 100 million are doing that through salaried work?

Who earns even 20,000,000 through salaried income?

If someone earns 100,000,000, they will pay 20,000,000+ in capital gains tax. 20 million. And some people are going to complain that it’s not fair to the person who makes 20,000,000 in salaried income?

Give me a break! Anyone who earns 100,000,000 yen a year and pays their 20,000,000 capital gains tax is a national hero.

-1 ( +0 / -1 )

So here is the answer, less than 1.2% of people in Japan earn more than 20 million yen.

https://www.mhlw.go.jp/toukei/saikin/hw/k-tyosa/k-tyosa09/2-2.html

I don’t think those earning more than 20 million yen are breaking their backs to work for it, any less than some person earning that much or more from investment income.

0 ( +1 / -1 )

Capital gains for most seniors = pension supplement.

So you take away from the Seniors to allow the Junior Politicians to live a life of Luxury, and spend your taxes upon things you completely have no say upon, but they probably benefit upon by having invested interests in...

1 ( +1 / -0 )

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