Japan Press Weekly

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2012 June 27 - July 3 [POLITICS]

Major businesses jubilant on consumption tax hike

Akahata editorial (excerpts)

Economic circles welcomed the passage through the Lower House of “unified reform” bills to raise the consumption tax rate and cut social security programs, forcibly conducted by the Democratic, Liberal Democratic, and Komei parties.

“We highly praise the Prime Minister’s leadership and cross-party efforts to pass the bills,” said Japan Business Federation (Keidanren) Chairman Yonekura Hiromasa (Sumitomo Chemical Co. president), bestowing the highest possible praise on the prime minister.

While 60% of citizens are opposed to the increase in the consumption tax, Keidanren welcomes the plan on behalf of Japanese major corporations’ interests.

The DPJ, LDP, and Komei agreed to revise the government’s “unified reform” bills in a closed door meeting just before the voting took place in the Lower House. From the original bills, they deleted the phrase, “restoration of the taxation system’s redistribution function,” as well as a provision to raise the maximum rate of income tax on the wealthy by 5%.

Meanwhile, the three parties included a new bill to “promote social security reform” in a related-bill package, which calls for “self-support” as the basis for social security programs and reduction of benefits under the guise of “efficiency.”

These revisions neatly meet the demands of major corporations, which object to even a slight increase in taxes on large shareholders and business owners and want to increase their profits by lowering their tax obligations for pensions and health care.

The urgent need is to put an end to business circles-oriented policies, cancel the consumption tax hike, and have major corporations and the wealthy pay their fair share in taxes.