Shoppers browse in a discount retail store in Tokyo. Photo: REUTERS file
politics

Japan weighs downgrade of economic outlook, raising doubts on sales tax hike

17 Comments
By Yoshifumi Takemoto

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17 Comments
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Bla bla bla! Just lip service. The tax hike will go through regardless of the economic outlook.

5 ( +7 / -2 )

call a snap election for parliament's lower house to coincide with an upper house poll this summer, at a time when Abenomics reflationary policy is sputtering.

What? Another election? Too many elections.

6 ( +6 / -0 )

Haha what a basket case is the Japanese economy. Personally I am in a very well paid job but many people here are really struggling.

4 ( +6 / -2 )

Japan has the lowest sales tax in the developed world, it also has a huge government debt and an increasing cost burden dealing with the ageing population. The Japanese economy could easily absorb an increase if the introduction were handled well. If not now then either much heavier tax burden in the future or drastically slashed services and real austerity like Greece.

-12 ( +2 / -14 )

If the government actually understood fiscal responsibility we might not be heading towards the cliff so rapidly.

6 ( +7 / -1 )

Never any cuts by the government to its own unneeded programs. Just keep the slush slushing along merrily.

5 ( +5 / -0 )

Japan has the lowest sales tax in the developed world, 

This is a very deceiving comment, because Japan is one of the few "major" countries that has a blanket tax rate, however you are quite wrong when it comes to some countries, as when the tax rate increases here, the rates will change and depending upon the products purchased the tax rate will differ as well.

Great Britain for example has a ZERO tax rate for "life necessities" where Japan's is 8% , so which is lower GB or Japan? SIngapore is 7% across the board, again lower than Japan, Saudi 5%, even NK is lower.

Making a blanket statement like this is deceiving to the casual reader!

The tax hike will go through regardless of the economic outlook.

Not necessarily, Abe postponed it twice, and the reason for the potential snap elections, reinforce his ability to control the economy and focus away from this issue.

There must be an election within the next couple of years and Abe would want to keep control before the economy sinks from another tax hike, like it did the last time!

8 ( +8 / -0 )

Greek economy failed because the government there was not allowed to issue its official currency, euro. Only the ECB (European Central Bank) can do this. Whereas Japan can issue as much yen as it needs until demand overly exceeds supply capacity. Japan’s economy cannot fail.

-4 ( +0 / -4 )

The time is not for wimping out AGAIN over this necessary tax hike.

-4 ( +1 / -5 )

Australia’s GST (goods and services tax) is 10%. Unlike Japan however, there is a long list of daily necessities exempted. It was only introduced after extensive canvassing of the views of all interested parties, and compensatory adjustments to help ensure that nobody would be worse off afterwards. Compare that with Japan, where the central government treats with disdain people’s legitimate concern that raising the tax without ensuring that we’re not worse off than before would be highly retrograde.

4 ( +4 / -0 )

Even with zero consumption tax or sales tax food prices in this country are exorbitant denying millions access to proper nutritional food for their families. An across the board added tax is always unfair and has no place in an advanced country. Raise taxes on non-essential items, but never on daily necessities.

6 ( +6 / -0 )

And while J-consumption tax may look low there are so MANY other taxes as well that get piled on that overall the people of Japan are really getting hammered & its getting painful to watch the country suffer while abe & his ilk just want to line the pockets of their friends who in turn toss many VERY THICK brown envelopes back in return for favours received.

In Japan corruption is basically legalized & THAT is why the debt is so high & prices as well giving all to often very low value for money spent!

5 ( +5 / -0 )

Even with zero consumption tax or sales tax food prices in this country are exorbitant denying millions access to proper nutritional food for their families. An across the board added tax is always unfair and has no place in an advanced country. Raise taxes on non-essential items, but never on daily necessities.

That is exactly what they are doing...

-1 ( +0 / -1 )

The politicians in Japan must have utter contempt for their own people by levying high taxes on the poor-shameful!

6 ( +6 / -0 )

The politicians in Japan must have utter contempt for their own people by levying high taxes on the poor-shameful!

I quite agree.

5 ( +5 / -0 )

Greek economy failed because the government there was not allowed to issue its official currency, euro. Only the ECB (European Central Bank) can do this. Whereas Japan can issue as much yen as it needs until demand overly exceeds supply capacity. Japan’s economy cannot fail.

No the Greek economy failed because it borrowed from foreign countries and defaulted on those loans, huge difference here!

Just printing money is not a solution, it just creates hyper-inflation, and while the BOJ may be increasing the money supply the government is NOT borrowing much, percentage wise, from overseas, in fact it is negligible. The overwhelming amount of money being borrowed is Japanese owned money.

Technically speaking all the bank is doing is taking money from the left pocket and putting into the right one!

THAT is why the Japanese economy has not failed up to date. But it can not continue for much longer! Japan's economy most assuredly can fail!

If an individual did what Abe has been doing, they would be arrested for playing a Ponzi game. Abe is using the income of future generations of yet unborn Japanese children to pay for his failed policies today!

2 ( +2 / -0 )

“Technically speaking all the bank is doing is taking money from the left pocket and putting into the right one!”

Not really! It’s more like borrowing from earnings that have not yet been accrued. And the way things are going, with an ominously declining population and rapidly escalating welfare bills, it’s becoming more unlikely by the day that the books will ever be balanced.

0 ( +0 / -0 )

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