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Japan Press Service Co., Ltd. is the only news agency providing information of progressive, democratic movements in Japan

Large corporations get 100 billion yen tax breaks for dismissing 100,000 workers

Shiokawa Tetsuya, a former Japanese Communist Party House of Representatives member, has revealed that large corporations received 100 billion yen in tax breaks for cutting 100,000 jobs between October 1999 and July 2005.

Under the 1999 industrial revitalization law, large corporations are allowed to apply for tax breaks in proportion to the number of workers they dismissed.

Under the 1999 law, 372 corporate plans to cut 99,608 jos were rewarded with 98.7 billion yen in tax deductions for registration and licensing of a new company or for capital increases. It means that every worker dismissal has been rewarded with about one million yen in tax breaks.

The industrial revitalization law was enacted under the Obuchi Cabinet by totally succumbing to Nippon Keidanren's (Japan Business Federation) requests for government assistance to corporate restructuring. The law was for a limited duration ending in March 2003, but the Koizumi Cabinet extended the law for 5 years with extended coverage, supported by the Democratic Party of Japan.

Commenting on the survey, Shiokawa said, "Prime Minister Koizumi is calling for the private sector to take over government undertakings. Its real intention is to support only a handful of large corporations. There is no parallel in the world to this law in which the government authorizes and supports the restructuring plans of large corporations. The JCP has been and is clearly opposed to this law. Only with a JCP advance in the election can politics be changed from one of supporting large corporations to one of defending the living standards and rights of workers and the people." -- Akahata, August 23, 2005

Top ten corporations and groups getting registration and license tax breaks (unit: billion yen)

Mizuho Financial Group 28.0
Risona Holdings Group 16.0
Mitsui-Sumitomo Financial Group 10.5
Mitsubishi-Tokyo Financial Group 7.5
UFJ Group 5.7
Sonichi Holdings 3.2
Mitsubishi Motors 1.9
Mitsui Trust Holdings 1.5
Daiei 0.9
Kanebo 0.89
Total of 10 groups 76.0