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

End tax breaks on big business and forego tax increases on working people: JCP

At the September 30 House of Representatives Budget Committee meeting, Shii Kazuo, Japanese Communist Party Executive Committee chair, grilled Prime Minister Koizumi Jun'ichiro about the government plan to carry out a massive tax increase in violation of his election promise.

Shii pointed out that the prime minister in the recent election campaign promised that there would be no tax increase on salaried workers, echoed by many LDP candidates but that the government Tax Commission in its report last June called for abolishing the current fixed-rate income and residential tax cuts and the deductions from taxable incomes for spouse and dependents will mean a major tax increase on salaried workers.

Asked about the relation between these two conflicting arguments, Koizumi said that the abolition of the fixed-rate tax cuts and deductions from taxable incomes for spouses and dependents "will not be a tax increase on salaried workers," but added that "I can't predict that there will be no tax increase in the future."

Shii said, "If the Tax Commission's plan is put into practice, taxpayers will be forced to pay an extra 6.4 trillion yen, and 80 percent of this increase, or about five trillion yen will have to be shouldered by households headed by salaried workers."

Pointing out that large corporations have been annually offered about 2.2 trillion yen (about 22 billion US dollars) in tax breaks under various names, including the promotion of research and development as well as investment in IT, Shii urged the prime minister to force large corporations to pay more in taxes.

Koizumi insisted that the "tax reform" that the government is contemplating is not meant to force salaried workers to pay more in tax because it has to do with all tax payers.

In answer to Shii's criticism of the generous tax breaks for big business, the prime minister said, "High corporate tax rates will force companies to operate outside of Japan. Bullying companies is not the answer." -- Akahata, October 1, 2005