Ruling coalition to reduce burdens on large corporations and increase burdens on the public

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Ruling coalition to reduce burdens on large corporations and increase burdens on the public

The ruling Liberal Democratic and Komei parties on December 14 adopted a FY 2007 taxation reform outline that includes a series of measures in favor of large corporations.

The outline stated, "The government and ruling parties will work out a drastic reform in the taxation system including the consumption tax as early as FY 2007," suggesting that the Abe Cabinet will enter into discussion on a consumption tax increase soon after the House of Councilors election slated for next summer.

The Japanese Communist Party calls for the cancellation of the tax increase imposed on the general public based on its policy of opposing the "upside-down tax system" that imposes heavier taxes on the public and provides large corporations tax breaks.

The outline specifies the revision of the depreciation system that will bring more benefits to large corporations that make heavier investments in plant and equipment.

The outline also sets forth a one-year extension of the preferential tax break for profits from securities due to expire in FY 2007 which halves the income and individual residential taxes on capital gains and dividends (normally 20 percent) in order to benefit the wealthy and promote stocks speculation.
- Akahata, December 15, 2006