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Japan tax revenue falls most since last June

27 Comments

Japan's tax revenue fell 9.2% in the year to March for the biggest annual decline since last June, hit by a delay in the due date because of the coronavirus pandemic, the finance ministry said, amid worries of bigger drops ahead.

While technical factors were blamed for the March decline, analysts are bracing for further slides in coming months, as the virus impact plays out in the world's third largest economy.

The specter of dwindling tax revenue fuels concern over more debt issuance to make up the income gap, which will, in turn, strain the industrial world's heaviest public debt burden at more than twice the size of Japan's $5-trillion economy.

In March corporate tax receipts rose 1.2% on the year, reflecting revenue from companies that settled accounts in January, before the virus had disrupted the economy further.

Analysts anticipate much bleaker tax collections in coming months, from companies that closed the books in March, the end of the fiscal year, when the virus took a greater economic toll.

Total tax revenue until March stood at 46.1 trillion yen($432.86 billion), just 1.8% short of the figure a year ago.

The pandemic has pushed back by a month, to April 16, the deadline for filing annual income- and gift-tax returns to avert an end of year rush to file returns, so aggravating infection.

The delay in reporting income tax and gift tax caused receipts of such taxes to drop 45.6% to 233 billion yen, and 23.1% to 240 billion yen, respectively.

© (c) Copyright Thomson Reuters 2020.

©2020 GPlusMedia Inc.

27 Comments
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And the government will spend like a drunken sailor. Giving no thought to fiscal responsibility.

12 ( +14 / -2 )

All the more reason to reduce the income of all elected Diet members by half for six months. They will be getting their bonuses along with all the bureaucrats next month. Also need to re-examine all of their perks and benefits that are at tax payers expense. Share the pain.

13 ( +14 / -1 )

Unfortunately salaries for govt types are a drop in the (leaking due to a gaping hole) bucket.

It would be ok for the govt to spend like a drunken sailor now, had it not been spending like a drunken sailor for the past quarter of a century too.

5 ( +8 / -3 )

When bueuracrats and government noddys oversee a failing economy it's a slap in the face when they garner in 3 months what takes the average worker 12 months. Then spend money on absolutely stupid things, tiny masks, two lane highway between Abe and Aso sans electorate, Hell every week almost every day there is a story about the elites financial stupidity. And they get less tax in but need to spend more. Way too many representatives didn't Abe promise to reduce them or was that another urge?

11 ( +11 / -0 )

Maybe they won't rip up the roads in my neighborhood for no reason other than to spend the budget.

7 ( +7 / -0 )

This japan tax system is absolute robbery... during this corona virus pandemic why government sent automotive tax bill to pay last week ?? That tax and vehicle inspection for 2 years and all is not at all needed..

5 ( +9 / -4 )

I suppose "falls most since last June" most work better in Japanese than it does in English, where it sounds weirdly sensationalist.

With Covid-19, it sounds like we are going to end up with other First World countries having national debt levels far in excess of GDP like Japan. It will be interesting to see what happens, if they can keep the plates spinning too. In some of these countries, household debt is way higher than Japan, due to extended real estate booms and student debt. The conditions are there for a Covid-19 recession-driven real estate crash.

The biggest chunk of Japanese government spending is on welfare, btw, mostly for old people.

3 ( +6 / -3 )

Abenomask!

The right man to bankrupt the ailing Japanese economy!

Vote Jiminto and see your taxes wasted on masks ,Aegis destroyers and the resurfacing of my roads all the while they line THEIR OWN POCKETS!!

5 ( +7 / -2 )

Actually many people/companies haven’t paid taxes yet because they extended the deadline of Payment beyond April 16th.

https://assets.kpmg/content/dam/kpmg/jp/pdf/2020/jp-en-e-taxnews-20200410-2.pdf

based on this of course tax revenues are way down

1 ( +1 / -0 )

Well, you know which way your income taxes and use taxes are headed in the coming years.

1 ( +2 / -1 )

Dan LavenderToday 09:02 am JST

Abenomask!

The right man to bankrupt the ailing Japanese economy!

Vote Jiminto and see your taxes wasted on masks ,Aegis

and what they should vote, the left, the democratic party ?

that one when in 2011 "everything is ok in Fukushima, don't worry" ?

lol

-4 ( +1 / -5 )

9%...…..I think its going to drop a hell of a LOT more than 9% going forward!!!

And yeah would be nice to see a token decrease on ALL govt employee's like 20% for a start & then up to 50% if we don't start  seeing any light at the end of this tunnel

Come on J-govt DO IT!!

6 ( +6 / -0 )

Increase the tax to 10%, lose the tax by 9%. Rich people carry on as usual.

3 ( +3 / -0 )

So how are they going to afford a "space unit" - raise taxes again?

1 ( +1 / -0 )

I just read this news.

https://www.ft.com/content/63b35e8b-b0c4-4652-9f1d-21dd7ca8a2e0

Bain Capital buys a retirement center firm in Japan. As you know, American private equity firms are notorious for making short-sighted decisions that rack up profits at the prices of employeees and consumers. This is a big retirement center firm in Japan! Now, it is likely that you will see massive cuts of employees and deterioration of retirement centres in Japan to make massive profits for American overlords. The Japanese government will get little cents from these foreign entities.

The American and European firms already make massive strides at doing M&A in Japan since Koizumi lowered the economic barriers. I expect Japan tax revenue will even get lowered as foreign firms will invade Japan and dodge every tax that they see. Japanese government will squeeze more from their citizens, while the corporate overlords (mostly foreign) will get away scott-free. Abenomics has always been the auction of Japanese economy for the highest foreign bidders.

0 ( +1 / -1 )

All the more reason to reduce the income of all elected Diet members by half for six months. They will be getting their bonuses along with all the bureaucrats next month. Also need to re-examine all of their perks and benefits that are at tax payers expense

Spot on mate..and not just for 6 months....they did an analysis on a TV show couple weeks back of the average Diet members compensation including their bonuses, the myriad of allowances and perks ( Hashimoto , ex Isshin no kai leader really hammered them , since he has a first hand knowledge of it ) . Your average Diet member gets to take home almost 800 thousand in USD per year , for sleeping through most of the time in their diet chairs and showing their face for a bit of door knocking, loudspeaker van riding come election time. Is it any wonder Abe,s LDP quietly reversed their promise to cut 80 Diet seats they made to ex DPJ leader Noda in exchange for cakling a snap election after 3/11 ? The swamp definately needs draining in Jpolitics.

4 ( +4 / -0 )

and what they should vote, the left, the democratic party ?

that one when in 2011 "everything is ok in Fukushima, don't worry" ?

lol

Yep ... anyone but the LDP fatcats , even for one term so that Jiminto has a reason to reform itself a bit and get rid of the oyaji deadwood if nothing else.

Btw, love it how the LDP fanboys selectively forget it was Jiminto who built the corrupt & incompetent N village system responsible for the 3/11 mess that DPJ took the blame for. Notspeakingwisdom again ey? :) About the only good thing about the coronavirus mess here is that it exposes LDP for the incompetent dinosaurs they are.

3 ( +4 / -1 )

Cognac - Just FYI. Fukushima was the LDPs project from the beginning. The Democratic party was in power during the disaster and I think handled it way better than the LDP could have. Also, it was abe who said figuratively, everything in Fukushima is ok when he bid for the olympics.

5 ( +5 / -0 )

Breaks my heart. How about pumping off $$ from these useless highway projects sponsored by Mummy Aso?

3 ( +3 / -0 )

Hokuriku 新幹線from Kanazawa to Osaka USLESS WASTE after implementing it take away the thunderbird and Shirasagi 特急 and creates a mess out of the local trains.

中央リニア新幹線even greater usless waste,

No more experience 新幹線!

Use the tax money to improve regional areas such as 能登半島,

飛騨areas, and other rural areas creating jobs and opportunities to build future businesses opportunity as well as hospitals and clinis by locals that can build population growth and bring opportunities for new graduates to stay insted of doing these multi decade usless road projects and train systems.

2 ( +2 / -0 )

Im sorry to say, but pensions will absolutely have to be cut. I'm guessing cut of 30% is the figure the govt will look at. And yes - ALL public servants should all take a 30% pay cut too - and zero bonus for 3 years.

0 ( +2 / -2 )

Workers work with the promise of a liveable pension, not going to happen. If you are a member of the LDP probably get so so much money you don't know what to do with it except get more. 80 year olds still getting tax payer money. If they were smart could have retired at 40. A leach is a leach and if you are born into money why would you care about anything. They are just worried they can't get enough money before they die.

0 ( +0 / -0 )

marcelitoToday 01:42 pm JST

and what they should vote, the left, the democratic party ?

that one when in 2011 "everything is ok in Fukushima, don't worry" ?

lol

Yep ... anyone but the LDP fatcats , even for one term so that Jiminto has a reason to reform itself a bit and get rid of the oyaji deadwood if nothing else.

Btw, love it how the LDP fanboys selectively forget it was Jiminto who built the corrupt & incompetent N village system responsible for the 3/11 mess that DPJ took the blame for. Notspeakingwisdom again ey? :) About the only good thing about the coronavirus mess here is that it exposes LDP for the incompetent dinosaurs they are.

sir, I don't vote in Japan cause I keep (proudly)(and I'm not ammerican) my homecountry passport, so say "LDP fanboys" to some other

(typical leftist answer, you don't think same as me so you are バカ)

0 ( +0 / -0 )

The debt can be paid back because it is in yen. Japan can never run out of yen, unless mentally deranged politicians want it too, like the "sequester" crowd in Washington. Dont worry about it.

1 ( +1 / -0 )

The debt can be paid back because it is in yen. Japan can never run out of yen,

Well said. It's true - Japan can just print more money to pay the tax shortfall, and pay the increased debt back, if it is domestic of course (as most debt it). I'd still like to see politicians tighten their belts a little though.

0 ( +0 / -0 )

Ok I have a photo copier, it’s a relic from the past but useful. I take a 10000-yen bill and copy it. What do you believe to be the value of the original 10000-yen bill?

0 ( +0 / -0 )

I see yet another hike in the consumption tax on the horizon.

0 ( +0 / -0 )

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