Heavier tax for old people, less burden on major companies: Koizumi's new
tax plan

The Koizumi Cabinet and the Liberal Democratic Party and two other ruling
parties have set forth a tax plan that would impose heavier burdens on
elderly people, while giving tax cuts to major corporations.

The new plan calls for an end to the current system of exempting old
people from paying a 20% income tax imposed on interests from small savings.
If the new rate is applied step-by-step after FY 2006, it will mean robbing
a total of 150 billion yen from aged people who partly depend on their
living on such interests returns.

Another tax system to be applied to major corporations now under massive
restructuring will allow parent companies to add the losses of their
subsidiary companies in settling their consolidated financial statements. If
it is introduced next April, it will help them save 800 billion yen a year.

Under the on-going corporate restructuring, most of Japan's large
corporations have established subsidiaries by dividing their unprofitable
sections. Because of this splitting, major companies have had to pay more
tax than before.

The new tax system, designed to help large corporations to reduce taxes,
will support them in further accelerating restructuring schemes, said
Akahata on December 15.

These tax plans reveal the essence of the 'restructuring policy' of the
Koizumi Cabinet, the paper said. (end)