politics

Abe faces another bruising debate over next sales tax hike

32 Comments
By Tetsushi Kajimoto

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32 Comments
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Nearly two-thirds of the public opposes the tax hike, double those who favor it

And that won't stop it.

6 ( +6 / -0 )

Ah, the tax hike. Last resort of an inept, negligent, fraudulent government that has failed to serve the people it is elected to represent. Why do we need these people if that is the best they can do? I can raise taxes. A monkey can raise taxes. Where are the people of vision and creativity? As in the Rush song; "And the men who hold high places, must be the ones who start, to mold a new reality, closer to the heart."

8 ( +11 / -3 )

Analysts generally expect Abe to give the go-ahead in December to raising the tax in October 2015 to 10% from 8%.

Don't do Abe. Reform government instead.

3 ( +4 / -1 )

Wolfpack:

Reform government instead.

TRUE!......................... So much money wasted in bureaucracy. . ............Abe is crazy if he goes ahead with the next Consumption Tax. . . ... .It will be the bell that tolls on his career, I believe.

1 ( +2 / -1 )

Maybe Abe thinks he's headed out and does this as Lame Duck. Doesn't have to care if population likes it or not.

-1 ( +1 / -2 )

Prices already went up more than 10% the last time he raised consumption tax 3%! How does he expect people to enjoy life! I see visitors are having fun.

5 ( +5 / -0 )

The decision has already been made. The debates are just lip service.

13 ( +14 / -1 )

Disgusting. Low wages... High taxes. Time to go home I think.

10 ( +11 / -1 )

to rein in government debt

Why should the general public be responsible for the government's debt ? When I first arrived in Japan, many moons ago, there was no such thing as a "consumption tax" and everything was fine !

5 ( +7 / -2 )

@Cortes Elijah

Disgusting. Low wages... High taxes. Time to go home I think.

I've been thinking the same thing - but mostly because of Abe's "provocation" towards his neighbours which could just end up in a big war...

6 ( +8 / -2 )

Whatever extra revenue is coming in from the consumption tax (people are buying less items, remember) is being used on pork barrel construction projects. So the debt is not being tackled. And the construction projects are not stimulating the economy.

The failure of these policies is pretty clear. Unfortunately, the opposition parties have no credible alternatives.

3 ( +4 / -1 )

Why should the general public be responsible for the government's debt ? When I first arrived in Japan, many moons ago, there was no such thing as a "consumption tax" and everything was fine !

Because the debt is mostly due to their insistence on social security. If we cut that, all of a sudden Japan would likely be in the black.

-2 ( +2 / -4 )

The twin debate about raising the consumption tax - which normal people pay - while simultaneously cutting the corporate tax - which only profitable companies pay - just makes me really angry.

They can`t have it both ways. If the government needs more revenue (and they do) then it is absolutely outrageous for them to be cutting taxes that, for the most part, only affect the wealthy. To be then raising taxes that even the poorest people have to pay to make up for the shortfall is just taking it to a morally indefensible level.

5 ( +6 / -1 )

"next sales tax hike"

Sure, put another dagger into the heart of the economy, idiots.

How about the next government spending cuts? Nah...

5 ( +5 / -0 )

a bit of manipulating the third-quarter GDP figures a few speeches to the masses on how the economy is recovering well, and big chunk of those new taxes goes directly into the pockets of the big corporations. your probably better off financially faking a serious injury and living on J gov benifits

3 ( +3 / -0 )

" Bruising debate " and similar " facing a.tough decision " type headlines are BS. The tax increase has been decided and that's it..the.blue.blood.politicians don't give a crap about the common guy, it's all about securing.some.more.revenue for ttheir cronies and companies, never.mind the sinking ship. Btw, when the tax increase policy was agreed.on.by Noda and Abe, in exchange for the.increased " burden" on.public the politicians agreed to " self sacrifice " by cutting what was it, 80 seats from.the parliament to.show people they share in the belt tightening. As expected, that promise has gone mysteriously and eerily quiet. How unexpected..As usual the J-politicians will screw the public while they themselves are willing to sacrifice nothing...J-public,s reaction is the usual shooganai, gaman shinai.to" attitude and since.they will re elect the same old farts at the next election, nothing at all will change. The longer I'm here the more.evident it is Japan has.no.capacity.for a truly meaningful and necessary change.

6 ( +7 / -1 )

"hard choice"? Gimme a break it's a very easy choice.

You can't stimulate the economy while hiking a sweeping tax at the same time. It's as simple as that.

4 ( +5 / -1 )

@wtf, faking serious injury and receiving Jgovt welfare, so true! They are the silent cause of depleting funds. Not to add that some of those receiving welfare are hoaxes too. I know of one receiving welfare from time immemorial not even experiencing how to labor. He is really physically disabled fitted with a pacemaker since young hence the govt housing rent isn't even 1 man. But he's living with his siblings with a monthly income including his benefit to over 50 man. If only housing officials would just do their jobs, and also if locasl govts would just do their investigations before giving out welfares....And if only faactories won't lay offs ....

2 ( +2 / -0 )

In a sense, Japan is a contradiction: rich in savings, poor in real living standards. In economics, virtue is not its own reward. Are the lawmakers listening?

2 ( +2 / -0 )

Ratio of Sale tax hike and increase in prices is nearly 3:30 and reports are focused on sale tax hike only. It's the rising prices that is hurting consumption...and again from tomorrow (1st Sept., 2014) prices of dairy-coffee and other products will rise from 2~40% (source: NHK). Abenomics is working....please re-start some nuclear reactors but stop Abenomics from working ...!

1 ( +1 / -0 )

Why should the general public be responsible for the government's debt ?

However you look at it the general public is the source of the funds to repay the debt. When government programs cost more than a government can tax to repay you end up with a lost decade or two - or more. Don't raise the consumption tax, reform government. It is not easy but it's the only way out of the box Japan is in.

0 ( +1 / -1 )

It never really ceases to amaze me how people will always decry social pension, welfare, and public benefits as the evil of spending. That some how the people in which government is of, for, and by are the ones to blame. It is time to understand government exists FOR the PEOPLE and NOT FOR THE GOVERNMENT.

Instead of heaping blame on the people how about a good dose of blame for the lobbyists. You know the ones who push for the pork projects. The paid activists and protesters who push the politicians into their spending on war toys, dams that dry up rivers and cause run off and mudslides. That force subsidies on agriculture that pays farmers not to plant rice to keep rice prices artificially high. That keep the right wing buffoons that a tiny minority the recipients of most government handouts.

Then lets not forget the unelected real power in Japan. The life long bureaucrats in all the ministries. They deal out the contracts to their family and pals in construction that pave over every single inch of these islands. Parks are devoid of grass but have beautiful concrete and asphalt. School play yards have no grass but concrete. Roads that dead end into another road that goes no place. Bridges built that are guaranteed in twenty years to need rebuilding. When they retire they then go to work at the universities and at companies they handed out contracts. Or they simply stay home collecting 600,000 yen a month pension and benefits they did not pay a single yen into but are guaranteed simply because they knew how to manage the red tape.

Then the toothless and spineless politicians. They are simply the face and mouth of Japan Government Inc. They really have no power other than to rubber stamp what the lobbyists and bureaucrats have decided. Know why the DPJ fell from favor? It wasn't Ozawa scandals, the LDP have had and had worse at the time. It was the fact the DPJ was going to castrate the influence of lobbyists and the power of bureaucrats. The LDP and their lobbyist and bureaucrat base could not have that. That would mean an to agriculture subsidies and farmers would actually have to get off their duffs and farm. Construction would have to actually bid, build, and manage. It would end the stranglehold of government and industry on the coffers.

No it is not pensions, welfare, and social programs that are the problem. The problem is professional politicians like Abe, Blinkyhara, Hashimoto,a nd the dynasty families they come from. The people deserve the social programs. Want to end the real problem? End the ties of lobbyists, bureaucrats, and politicians. That is the triangulation, follow the money.

4 ( +6 / -2 )

"When government programs cost more than a government can tax to repay you end up with a lost decade or two - or more"

That's an economically illiterate statement. "Lost decades" occur after financial meltdowns, which are caused by the private sector. Specifically, rampant unregulated capitalism by the financial sector seeking short-term profit. The resulting crash dampens private demand over the long term, leading to low growth.

The government is then forced to supply the demand the private sector refuses to supply, leading to ballooning deficits.

By contrast, many countries with huge govt spending on social programs, like Norway, have the world's strongest most stable economies.

0 ( +2 / -2 )

As usual the rich will get richer off the backs of the middle and lower classes

3 ( +3 / -0 )

When government programs cost more than a government can tax to repay you end up with a lost decade or two - or more"

When such programs does exist, it should be done in a private sector. Unfortunately, government programs exist to not fit in that category.

Look. I've been to balanced budget states and regions and the first thought that comes to mind is "when am I leaving this crap hole?"

-13 ( +1 / -14 )

The people deserve the social programs. Want to end the real problem? End the ties of lobbyists, bureaucrats, and politicians. That is the triangulation, follow the money.

The people deserve a government that they can afford and that can at least fulfill the basic functions of government.

I should also say that lobbyists do not vote on behalf of the voters. Lobbyists serve the function of bringing the peoples issues to the attention of government. It is the politicians that write the laws that created the huge public debt that must be repaid by ever higher taxes - which in turn damages the economy in a free society. It goes without saying that a less productive economy generates less in taxes than is otherwise possible. Japan is boxed in economically because of the legislatures promises for social welfare programs that the nations economy is unable to support. That's not the fault of corporate lobbyists. It will take full on Socialism to extend the life of the current system and the subsequent government control that goes along with it. Even China knows that's a dead end not worth going down.

If people will rely less on the dream that government can meet all needs for all people and realize that there are limits to what government can deliver, perhaps Japan can one day extract themselves from this bind without completely destroying the living standards of future generations. It would be great to see Japan make the reforms that everyone knows must happen in a controlled manner. That would make it less painful for the people to endure. It would also provide a roadmap for Europe and America to follow as they are going down the same path to insolvency. Otherwise change will be forced upon all of them by the laws of economics.

0 ( +2 / -2 )

<>August 31, 2014 3:40 P.M JST<> I am absolutely against boosting the consumption tax from th current 8% to 10 % come next October. The so-called Abenomics, Ahonomics, depending on ypur perspective on the overall policies pursued by the current cabinet, has been proved to be a failure as had been expected from the start; it has only contributed toward getting the Japanese yen depreciated against the US dollor by 20 %, and getting the issuance of the government bonds boosted accordingly. What they were after by the depreciation of the yen was to boost exports, getting the most out of the 110 -yen mark to the dollor exchange rate. But the fact of the matter was, overseas factors in Europe beyond the control of Japan has been working against re-enforcing the national economy riding the crest of the export-driven demand. What we have at home instead is all the materials we have to import , reflecting the steep depreciation of the yen againt the dollor, have gone up in retail prices. My "pap in the kitchen sense of economy" tells me that all the utilities charges in addition to retail prices in basic commodities have gone up when the pension payments have been reduced little by little. Those who live on pensions have hell of a hard time making both ends meet. What Mr. Abe is trying to do is to reduce the cprporate tax and in order to make up for the loss of the revenue from the lower corporte tax , give ordinary people another 2% increase in consumption tax. He should remind himself, or we must remind him that who he has been chose to repreent.

4 ( +4 / -0 )

@Nigelboy " Look. I've been to balanced budget states and regions and the first thought that comes to mind is "when am I leaving this crap hole?"

Nonsense, I've been to Norway which is a great example as it is running a budget surplus and its an awesome place , not a " crap hole". Seems you are just unable to admit any negative point about Japan regardless of the topic or how blatantly obvious it may be.

7 ( +8 / -1 )

@marcelito, well said!

There are some people here in this forum are absolutely in denial and delusionwhen it comes to the issues faced by Japan. It seems to me they are living in a parallel universe so that facts and data are irrelevant to them, they would defend Japan’s good, bad and ugly things, regardless.

To make you feel better, let me quote hidingout’s reply written few days before Japan’s economic data went public.

“Yes. In my universe things are going along very nicely. The company I work for has seen double digit growth in sales since Mr Abe was elected. We have hired two hundred new staff over the same period. The stock market is flirting with records highs. Summer bonuses were among the highest I've ever seen since coming to Japan. Check out the unemployment stats - anyone who can speak Japanese and has a functioning brain can get a decent job these days. I seriously don't know anyone who lives in your universe. In fact, the only people I see complaining are those with a socialist agenda (like many of the gaijin here at JT) or people with an obvious axe to grind against Japan (like yourself). I look forward to many more years of Mr Abe's excellent leadership, and I will keep coming here to JT to read the impotent tear stained comments of the socialists and receive my "bad" ratings from folks who obviously wouldn't recognize a solid economic platform if it was succeeding right in front of them.

So how about you stay in your universe and I'll stay in my "parallel" one. Sound good to you?”

I am speechless. :)

4 ( +4 / -0 )

Nonsense, I've been to Norway which is a great example as it is running a budget surplus and its an awesome place , not a " crap hole". Seems you are just unable to admit any negative point about Japan regardless of the topic or how blatantly obvious it may be.

They have oil revenues to compensate the deficiencies. They are certainly an exception rather than the norm.

-3 ( +2 / -5 )

They have oil revenues to compensate the deficiencies. They are certainly an exception rather than the norm.

True. But give the Norwegians credit for developing the resources they have for the benefit of their people. The Japanese are not fortunate to have the same kind of resource that can compensate for the shortcomings of their political/economic/social welfare system.

0 ( +2 / -2 )

Many people would not object to a tax hike if it were going to go to the redevelopment of Tohoku, but when it is going to be spent on a military build-up, the Tokyo Olympics and other vanity projects of right-wingers, there is good reason to object.

3 ( +4 / -1 )

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