DPJ, opposition reach tax deal to end deadlock

By Kiyoshi Takenaka and Tomasz Janowski

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So, the government assures themselves of a new source of revenue without first having to eliminate wasteful spending, business as usual with the so-called quasi-government bodies and other bureaucrat-catching entities, without a clear path to recovery for the Tohoku region, without a firm energy policy, without establishing solutions for rising healthcare costs or child are shortages, without doing pretty much anything to ensure the additional funds won't just go up in smoke (or down a black hole). Major accomplishment, boys and girls!

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For a while the DPJ were at least pretending to want to cut wasteful spending. Now they don't even bother bringing up the topic. The public have been sufficiently worn down by the constant refrain that a consumption tax increase is inevitable (including articles such as this one), that the DPJ can now be what it was always destined to become: just another LDP.

1 ( +3 / -2 )

Why should Japan listen to IMF anyway? Japan's debt is almost entirely internal, and they one of the biggest "donors" to IMF. Perhaps IMF has already dismissed Europe as a lost cause?

Japan needs to cut expenses before raising taxes as there is no need for a 10% tax when you can save much more by reducing pension plans by ten percent (since those plans grow faster than inflation)

0 ( +1 / -1 )

Democracy under Noda - ignore public opinion that is overwhelmingly against the tax increase or nuclear restarts whilst declaring with a straight face that you are doing it for the " benefit of The Japanese people". Damn liar.

2 ( +2 / -0 )

Throw all the bums out into the real job market. Crooks!

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I can see you all hate it, but this tax increase really is the only plausible way for Japan to start to deal with its enormous debts. The spending cuts the commentators above call for are going to be needed too, but slashing spending aggressively while the global economy is weak and exports are being hammered by the strong yen would be disastrous. Believe it or not, Japan has already been squeezing its government spending quite hard in recent years - public works spending, for instance, has declined substantially. But the ageing population and weak economy put inexorable upward pressure on government spending, and it's simply not plausible to expect to balance the books without a substantial tax increase. Japan's tax revenues are currently one of the lowest in the OECD as a share of the economy. Well done Noda for apparently succeeding where so many of his predecessors have failed!

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reply to basroil although it is sound reasoning to say the government needs to cut wasteful spending, i don't think reducing pension plans would be acceptable not least because of the voting power the older generation have, who are sure to protect their pensions (and who wouldn't?) but also, lowering pensions for people who retire aged 60 and may live on another 20+ years will just put millions of people into poverty. They can only rely on pensions, and for such a long period unless the retirement is raised, and there is a change in Japanese work culture towards accepting elderly people into the workforce

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