LDP-Komei government gives large corporations 87 billion yen in tax breaks for 90,000 job cuts

Taking advantage of the Industrial Revitalization Law that gives corporations tax relief as a reward for job cuts, Japan's large corporations received more than 87 billion yen between October 1999 and March 2004. The "reward" was for more than 90,000 job cuts, and the total amount of tax breaks was 920,000 yen per job cut.

Findings of a survey conducted by the Japanese Communist Party Dietmembers Group were published in the July 4 issue of Akahata. During the 4.5 years, corporate taxes were reduced by cutting 94,139 jobs.

For example, major banking corporation Mizuho Financial Group had a tax break of about 27.42 billion yen for a 7,600 personnel cut program. Leading supermarket chain operator Daiei, Inc. had tax breaks of 575 million yen for 19,026 job cuts. Toyota Motor Corp. in which Okuda Hiroshi, chairman of the Japan Business Federation, serves as the president, had 355 million yen in tax breaks for a 3,259 personnel cut although its net profit exceeded one trillion yen. Mitsubishi Motors Corp., in which its former president was indicted for the cover-ups of defective cars, got 690 million yen in tax breaks.

The Industrial Revitalization Law is in place to support large corporations through tax relief and other favorable treatments in exchange for downsizing the workforce. On calls from the business circles to help promote further corporate restructuring, the Liberal Democratic Party, the Komei Party, and the then Liberal Party enacted the law as temporary legislation until the end of March 2003. Later, with support by the Democratic Party of Japan, the deadline was extended for another five years.

The Japanese Communist Party demands that the law be abolished and that large corporations create more jobs. (end)