politics

Cabinet approves corporate tax cut

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Kan has said he hopes the cut will encourage companies to increase investment and create more jobs.

Yeah right, companies are flush with cash right now and they haven't chosen to create more jobs. Even when they've hired, more than 90% are temporary staff. Some companies now run entire offices with temporary staff. The Japanese govt. should put an end to widespread corporate abuse of temporary workers by capping the number that can be use at 15-20% of total staff.

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Manufacturing is suffering because jobs are going overseas. I do not see how cutting corp taxes will increase domestic production or increase consumer spending for DOMESTIC product. Instead, the govt should make incentives for new businesses in the service sector or manufacturing in hi-tech.

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And the obvious question is how do they make up for the lost revenue?

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saw this on the news last night...they tax the public, primarily.

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companies are flush with cash right now and they haven't chosen to create more jobs

Are they obligated to do so?

What about law firms? Should threre be a cap on what they plunder? At least companies create goods and provide services...

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No of course companies are sacred and their decisions should never be criticized.

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Manufacturing is suffering because jobs are going overseas. I do not see how cutting corp taxes will increase domestic production or increase consumer spending for DOMESTIC product. Instead, the govt should make incentives for new businesses in the service sector or manufacturing in hi-tech.

Really? You don't see it? If you have to pay less to the government, you have more money, you can afford to make capital improvements, to hire people who might possibly contribute to your company, that you otherwise might not have been able to afford, you can afford to pay larger dividends to shareholders who then reinvest the money, or spend it elsewhere, thus directly spurring the economy as well. Cutting the corporate tax rate is a good thing. It makes corporations more competitive against foreign companies. This directly impacts every single sector of the economy in a positive way.

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You don't see it? If you have to pay less to the government, ...

1) Capital Improvements are tax deductible over a set period of time, so tax cuts would have a very limited effect on a return on investment calculation.

2) Unless the jobs are highly skilled jobs, the jobs will still be outsourced as it is still far cheaper to outsource.

3) Less taxes means that less money will be spent on infrastructure, such as fiber-optic, highways, seaports and airports reducing the chance companies will setup headquarters and/or the likelihood of high-tech jobs moving in, which would mean manufacturing jobs, which again are outsourced to countries with far cheaper wages.

4) Governments that have reduced corporate taxes often have greatly increased the debt load of the country (See Reagan vs National Debt), which means that they have only deferred having to play higher tax.

Instead the government should focus on effective spending of tax monies and becoming more efficent, instead of wasting tax dollars.

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