Let them not eat
Japan’s Finance Minister Sadakazu Tanigaki has voiced his resistance to calls for reduced consumption tax rates on food and other daily necessities when the government raises the tax rate from the current 5 percent.
“Reduced rates are not necessarily needed,” said Tanigaki, who proposed doubling the consumption tax rate to 10 percent by the mid-2010s as one of his policy pledges when he announced his bid Thursday to succeed Prime Minister Junichiro Koizumi, who is stepping down in September.
Japan is different from Europe, where in some countries sales taxes top 20 percent and reduced rates are applied to some items, he told reporters.
Is anyone else getting tired of Japanese politicians constantly trying to rationalize tax policies by pointing to other countries? Some countries in Europe take a full month off in the summertime, but I don’t see anything like that happening soon in Japan.
Tanigaki reiterated that the government should use consumption tax revenues specifically for social security purposes when the tax is raised.
This also is an obvious ploy designed to make a doubling of the tax more palatable to the rubes. If I remember correctly, the government was able to get the people to accept implementation of the consumption tax in the first place by promising it would never go over the original 3 percent. I’d be willing to bet that once the rate gets to the level the government wants, all this talk about using “consumption tax revenues specifically for social security purposes” will go right out the same window.
And you know what? I’ll also bet that the people of Japan will just suck it up and pay.
“Is anyone else getting tired of Japanese politicians constantly trying to rationalize tax policies by pointing to other countries?”
Yes, and they always borrow the bad ideas too. Whenever they borrow an idea from other countries, especially the USA, it’s always a stupid one. They never try to emulate any of the good things about this country, like lowering taxes, repealing senseless regulations, and legalizing the owning and carrying of guns (everyone here seems to think legalizing guns increases crime when in fact it decreases it). Things like that are why Japan’s rank on Economic Freedom in the World keeps dropping.
July 31st, 2006 at 6:58 amWow there, dude! Who are you talking to out there, Mr. Tanigaki. It’s sad that the Japanese people don’t take their franchise more seriously. If the people are really listening, a big government, tax and spend guy like this would and should be thrown out. With economic indicators showing that we’re finally going north, it would be bad to see this economic re-strengthening again stagnate with increased taxes…
July 31st, 2006 at 11:19 amThe fact is possibly closer to this:-
“When countries first introduced the VAT, the average standard rate was 12.5%; in 1998 it was 17.5%.”
*(For VAT read Consumption Tax)*
Maybe there’s a little too much protesting on this issue - methinks..:neutral:
August 2nd, 2006 at 8:15 amJust a link to back up the previous post.
(Comparative Marginal Tax Rates).
http://gregmankiw.blogspot.com/2006/07/tax-rates-around-world.html
Japan…”cop-it-sweet”!!:wink:
August 2nd, 2006 at 8:49 amMaybe there’s a little too much protesting on this issue
Um…. Are you saying that Japan has room to raise its tax rates because rates are higher in other countries?
Did it ever occur to you that tax rates might be too high in other countries?
August 2nd, 2006 at 10:26 amI’m not suggesting parity…but I am suggesting that there is a “slight” room to move.(Consumption Tax-wise)
At present I pay tax for one family unit across two countries - Japan + Australia.:cry:
August 2nd, 2006 at 10:42 amAll this talk of upping the rate of consumption tax is madness. When you have an economy that’s been in the doldrums for a decade and you want to boost consumer spending, the one thing you don’t do is exactly that.
August 2nd, 2006 at 1:22 pmBut Japan has a (very) rapidly shrinking tax base.
How to get around this??.
I agree that the country has finally managed to drag itself out of a deflationary hole, and jacking up the VAT would impact on consumer spending…but again …anybody got any ideas as to where the money’s going to come from for pensions & health care ???
Compulsory superannuation?? lotteries?? death duties?? (that’s a good one!!) inheritance tax??
August 2nd, 2006 at 1:51 pm“parasito” tax …etc,etc…NAAAHHH.:sad:
I missed one!!Just jack-up income tax till everyone turns white.(with rage):shock:
August 2nd, 2006 at 1:59 pmPensions and health care. . .
A lot of the people who pay the consumption tax do not benefit from the pension and health care schemes. I read somewhere recently that around 50% of the people of Japan are not covered by the pension system. Up to now, these individuals did not pay into the system. Increasing the consumption tax to cover pension shortfalls will result in 50% of the people paying for something that will never benefit them.
Also, an across-the-board rate means that people who are drawing pension and health care payments will be returning a portion of those payments to the government when they spend their benefits.
Then there is the question of whether the government even should be involved in providing pension and health coverage for the general populace in the first place. . .
August 2nd, 2006 at 4:41 pmWhat’s next? Calls for Japan to “do its part” and “pay its fair share”?
August 2nd, 2006 at 4:47 pmAll I started out saying was..
If Japan is going have a Consumption Tax then make it one with some balls.
Otherwise scrap the damned thing and find another way to raise the money.:neutral:
August 3rd, 2006 at 6:07 amThe biggest problem is the growth of government. I would love to be able to tell my employer that I need 20% more salary this year because, hmmm let me see, I need to pay for more dental work, and the current system doesn’t cover it. What would that get me? Probably a pink slip. I don’t understand why it’s any different for governments. Look at the NHK story JP postes after this one. There’s too much money/programs that are in the opaqueness that is government, which we will never find out about. Remora, I feel you pain paying 2 income taxes, I do the same. Aren’t we the ones being told to ‘bend over and assume the position’? The more and more we leave dudes like this Tanigaki hanging around, the quicker we will be white in the face with rage. As they say, the frog doesn’t notice that its in a pot of water over an open flame until it’s too late. Lets not be that frog!
August 4th, 2006 at 6:32 pm