politics

Sales tax cut emerging as option as gov't battles coronavirus fallout

42 Comments
By Kaori Kaneko and Tetsushi Kajimoto

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42 Comments
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"Today's results suggest that there is now abundant dollar cash, at least among people who have access to the BOJ. The key point now is whether this money will spread to various companies and others that need it," he said.

Until now, it hasn’t so why assume the ‘key point’ is it will?

10 ( +10 / -0 )

Shouldn't have raised it in the first place. The economy was starting to slide further towards a recession and now this virus outbreak gives Dear Leader a chance to "take it back"!

19 ( +20 / -1 )

Goody goody!

-2 ( +2 / -4 )

Now would be a good time to introduce V.A.T. Reduce tax on essential items that people need for day to day life and raise the tax on non-essentials.

22 ( +22 / -0 )

“Sales tax revenue was important to fund social welfare costs “

Wrong. The government raised the consumption tax just to reduce corporate tax rates and bolster stock prices.

24 ( +28 / -4 )

Luxury tax, taxing those who got the money, stop wasteful spending .....

There are so many options.

And be assured that they will raise the tax again, maybe even more than those currently 10%.

19 ( +19 / -0 )

@klaus -

Interesting points....

Luxury tax (I agree with this)

Taxing those who got the money ( How is this quantified? How much is having the money?)

They will raise tax again - more than 10% (Certainly...this will have to be done out of necessity)

The obvious result of this virus is people getting sick and some deaths which is terribly sad.

The fallout from this virus coupled with what appears to be a lack of leadership and direction as to how this is being handled is likely to be much worse and could possibly bankrupt this country.

I think most thinking people are now realizing the entire world (not Japan only) is living through history right now and this could very well lead to a global depression (not a recession).

Japan's leaders need to show leadership!!

Postpone Olympics

Start testing people

Follow Korea's method (which appears to be working) of isolating those who test positive, identifying their contacts, and isolate the contacts as well

Choose focused and direct actions which are measurable instead of uncertainty and lack of direction (which leads to fear). This pandemic can definitely be beat but it cannot be beat by inaction and just ignoring facts.

7 ( +8 / -1 )

How will this help when businesses are shuttered or see reduced traffic and workers have reduced or lost paychecks?

7 ( +7 / -0 )

A group of ruling party lawmakers proposed last week that the government temporarily eliminate Japan's 10% sales tax

Make it permanent!

and prepare a 30 trillion yen supplementary budget for spending

No, no, don't waste 30 trillion yen!

10 ( +11 / -1 )

How about dumping sales tax altogether?

15 ( +16 / -1 )

Japan's leaders need to show leadership!!

I think you expect too much from hereditary second-third-fourth generation politicians who never had a real job and are born in an incestuous parallel universe.

22 ( +23 / -1 )

A tax cut requires a new legislation, Diet approval and implementation... that's so time-consuming that people wouldn't be able to wait. Many businesses need a quick money for survival. Universal cash provision may be more effective.

3 ( +4 / -1 )

Abolish sales tax on all essential items, food, medicine, school items.

26 ( +26 / -0 )

YubaruToday 06:57 am JSTShouldn't have raised it in the first place. The economy was starting to slide further towards a recession and now this virus outbreak gives Dear Leader a chance to "take it back"!

are you kidding me? this was perhaps the best decision abe has made since assuming office. kicking the can down the road for the next generation to pay for health care costs would have been irresposible. as japan ages even faster, how will japan for for the booming health care costs? and who will pay for it? if not now then when? it's this type of myopic thinking that exacerbates the financial crisis facing japan.

and i don't see how they can temporarily cut sales taxes. the computers and registers all need to be reprogrammed.

-9 ( +5 / -14 )

Teasing us with a reduction in sales tax is a great way to absolutely kill immediate purchasing.

12 ( +12 / -0 )

The best thing Japan and any other country can do right now is cut all taxes to zero, and stay away from the printing press. On one hand they are ordering people to not leave their homes, on the other hand they are thinking of injecting more stimulus into the economy to make people spend more. People aren't going to spend, and they shouldn't spend, they should save their money and buy only the necessary items, and businesses shouldn't artificially be made to divert resources producing stuff that people don't need and won't buy.

10 ( +10 / -0 )

Safe to say 'abenomics' has failed. Now if only he'd slither off into the dustheap of history, japan would be better off.

11 ( +14 / -3 )

@nakanoguy01

 it's this type of myopic thinking that exacerbates the financial crisis facing japan.

Japan has been "facing a financial crisis" for how long now? 20 years? How come it hasn't happened? Financial crises in developed countries are caused by the financial sector - banks and real estate - and by getting indebted to foreigners, not by social welfare spending.

6 ( +7 / -1 )

America and the UK are introducing massive stimulus packages to help protect against the economic effects of the virus. The UK will give business like pubs, restaurants which have been closed will pay no business tax for one year.

The American package is $1 trillion. The UK will be a £330billion package, 15% of GPD, including suspension of mortgage payments for three months.

There is already a start of a major global recession. '

3 ( +3 / -0 )

Safe to say 'abenomics' has failed. 

Huh? Japan appears to be doing better economically, not to mention socially, than most western countries right now. The streets are a bit quieter, but not deserted as in Manhattan, London and Rome. Offices are still humming, my train is still standing room during the commute and I went to a pub on Saturday in Tokyo that was absolutely packed.

0 ( +3 / -3 )

as japan ages even faster, how will japan for for the booming health care costs? and who will pay for it? if not now then when? 

It likely won't. And a tax increase isn't going to get us any closer. The only way the debt will be settled is by inflation or default combined with cuts in govt. spending. Punishing already struggling people with a tax increase on their daily lives is just a cynical ploy to appease the world's bankers.

2 ( +3 / -1 )

So, sales tax is used to fund public welfare. This is on top of the pension scam with a less than 20% return on the installments. The local municipalities have been head hunting anybody with arrears on their city taxes and threatening and demanding money from anybody with debts. The recent sales tax increase is only applied to a few items and voided when using E-money. Corporations have already received huge tax cuts that were supposed to be passed on as salary increases after the 5% to 8% jump. Therefore, from all these subjective promises in the article Naoki Average (90% of the population) is gonna get bugger all and will be worse off and further in debt than before. How wonderful!

3 ( +4 / -1 )

Too little too late. If people don't have jobs because companies fires them then tax cut won't help because no-one is going to buy anything than rice.

And all that money that you will "inject " into the big corporations won't help as well.

5 ( +5 / -0 )

So the Government still want people to go out to the malls and go on trips? Utter insanity.

6 ( +6 / -0 )

Time to diversify currency holding .Dollar have no value backing are based on an outdated system the world should not trade solely by using dollars and should not heavily dependent in USA .USA have been doing a lot of damage to world economy by destabilizes countries in order to.maintain it take supremacy. I have been watching these act of criminal for last forty years every countries meddling or interference by USA never recover their resource plifiging and profiting by USA inc. disaster humanitarian crisis if these event don't crush USA special interest group and it politician policies .The future don't stand a chance .Japan are one of the support of these USA adventure .Japan have a lot at stake because it never diverse it investment away f

From USA .Japan it like a drug addict so use to USA policies tagging along . China now have a rude awakening not to depend export to USA and not to depend supplier from USA .China can become self reliance nation if it follow it own rule of governamce from thousand years to guide it development with it own talent will succeed ,if they keep care watch on western interference and don't blindly adopt any western financial policies.it will come thru with success

-2 ( +1 / -3 )

All the people who just bought the new cash registers, the vending machine owners, train companies, and everyone else who just reprogrammed and set and got used to asking if you’re eating in or taking out will be thoroughly impressed once again with the whimsical decision-making of the government.

9 ( +9 / -0 )

Not gonna make any difference to me. Now if they were to cut my kokumin hoken cost, that would be awesome! And considering I'm in the tourism industry and lost all my jobs this month, next month and most likely May, man I don't know.

7 ( +7 / -0 )

I hope this is a permanent cut especially with regard to all groceries. On the other hand, will this really make a difference on the economy if we are in a lockdown and stuck in our homes?? How about we do a "Andrew Yang" and give everyone a $1000 (or Yen100,000) per month as long as this situation lasts??

6 ( +7 / -1 )

abe is a failure.

enough said.

4 ( +4 / -0 )

A super dumb,real dumb idea.The wailing and gnashing of teeth is still going on from the increase back in October.Look at the noise it took to go to 10% from 5%.If you put it down,then when will it go back up? Because the reality is, at 10%,it's still too low anyway!

-3 ( +2 / -5 )

Crazy times. Is this the beginning of the end?

0 ( +0 / -0 )

Time to diversify currency holding .Dollar have no value backing are based on an outdated system the world should not trade solely by using dollars and should not heavily dependent in USA .USA have been doing a lot of damage to world economy by destabilizes countries in order to.maintain it take supremacy. I have been watching these act of criminal for last forty years every countries meddling or interference by USA never recover their resource plifiging and profiting by USA inc. disaster humanitarian crisis if these event don't crush USA special interest group and it politician policies .The future don't stand a chance .Japan are one of the support of these USA adventure .Japan have a lot at stake because it never diverse it investment away f

From USA .Japan it like a drug addict so use to USA policies tagging along . China now have a rude awakening not to depend export to USA and not to depend supplier from USA .China can become self reliance nation if it follow it own rule of governamce from thousand years to guide it development with it own talent will succeed ,if they keep care watch on western interference and don't blindly adopt any western financial policies.it will come thru with success

key west is obviously Chinese and a troll...

don't forget china started this crisis pal!!

-2 ( +0 / -2 )

How are people supposed to buy anything when they have to stay home with no pay?

6 ( +6 / -0 )

Exactly Rosalind! Even if there will be sales tax cut there is no money to buy anything.

Secondly even if government will "inject" all that money to economy or let's say they will hand over your salary for the time you spent at home it's not going to help. Do we really think that after that two weeks everything will go normal as it was? Business will still be affected for long time.

People won't start travelling right away as they barely survived coronavirus so they will need to save money, you won't buy cars, electronics. So this measures won't help. I mean you can do the sales tax cut anything this is the beginning of new economic system.

2 ( +2 / -0 )

This is like a joke, if we cannot fix it, we will do anything. Think before U act, this is a basic rule. U are the goverment. What is next ???. I give u the solution, find the cure to corona virus and stop wasting precious time.

1 ( +1 / -0 )

Bad idea! People will not benefit immediately from tax cuts. People who are living pay period to pay period will need assistance right away. Just give cash directly to individuals. They are tossing around the idea in other countries. I predict the Japanese government will take some drastic measures next week. Stock up people, because you know what happens when they announce these measures. My prediction..Check back with you next week. Hope Im wrong.

1 ( +1 / -0 )

So are all going to get ¥10,000 again?

0 ( +0 / -0 )

the World has gone to the dogs, but it’s ok you can pay 3% less in consumption tax on goods?! Give every household with kids a tax rebate of ¥200k. Now is not the time to spend on luxury goods, this reduction won’t make any difference..

0 ( +0 / -0 )

PM Abe deciding whether to give money in cash to everyone. Under 18 and over 65, ¥20,000 and ¥12,000 for all others.

0 ( +0 / -0 )

Brilliant!

How about eliminating the entire social welfare and pension systems together with the elimination of the consumption tax!

It's sheer genius!!!

0 ( +0 / -0 )

If they are gonna do it, they better o it fast. The longer they hang the idea out the longer people will wait to buy things as they will think it might be cheaper in the future.

0 ( +0 / -0 )

If the purpose is to stimulate consumer spending, it will fail. Invalid CSRF

0 ( +0 / -0 )

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