tax

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Business circles to propose extra period of corporate tax breaks

The Japan Business Federation will ask the government to give an extra period of tax breaks for large corporations in its proposal concerning tax system reform beyond FY 2006.

In the proposal coming out in September, the JBF wants the preferential tax breaks for large corporations engaging in research and development and investing in information technology (IT) to be extended. after the measure is due to expire in March 2006.

The measure, introduced in FY 2003, allows large corporations to deduct up to 12 percent of their R&D costs and also deduct 10 percent of IT costs from the corporate tax. By this system, large corporations have been spared as much as 1.2 trillion yen in taxes.

As for the introduction of an "environment tax," which was shelved in the 2005 discussion, the JBF again stated its opposition. -- Akahata, August 24, 2005