Business circles’ outrageous demand for consumption tax hike

Akahata editorial (excerpts)

   The two candidates contesting for the Liberal Democratic Party presidency are sticking to a consumption tax hike despite the fact that the voters rejected the “structural reform” policy that forces people to pay more in the recent House of Councilors election.

   Former Chief Cabinet Secretary Fukuda Yasuo stated, “If cost cutting fails to meet requirements, we have to consider raising the consumption tax rate.” LDP Secretary General Aso Taro also stated, “We have to give full consideration to raising the rate of the consumption tax that will be exclusively used for welfare services.”

   The LDP has a good reason to stick to an increase in the consumption tax rate because this is a firm policy of business circles, the LDP’s most reliable supporter.

   At a press conference on September 10, Japan Business Federation (Nippon Keidanren) Chairman Mitarai Fujio demanded that the government consider raising the consumption tax rate.

   A few hours before Prime Minister Abe Shinzo announced his resignation on the afternoon of September 12, leaders of Nippon Keidanren and the LDP held a meeting in which the business representatives again requested the LDP to consider raising the consumption tax rate.

   After the recent House of Councilors election result became known, Mitarai lost no time in expressing his support for the Abe government and its “structural reform” policy. It is ruling circles that have promoted such a policy and that have received its benefits.

   Business circles are sticking to further consumption tax hikes in order to further promote their interests.

   Mitarai has been calling on the government to reduce the corporate tax rate (state and local combined) by 10 percent and proposing to raise the consumption tax rate to secure the financial source for the cuts in corporate taxes.

   They even put forward a proposal to get rid of corporate burdens in social welfare services, including the corporate share of pension premiums, by using the consumption tax exclusively for welfare services.

   It is unacceptable for business circles to evade their social responsibility and greatly increase their profits by shifting the tax burden onto the general public.

   Business circles have the LDP securely in their grip through corporate and organizational donations of nearly three billion yen, including 64 million yen from Toyota Motors and 40 million yen from Canon.

   Without questioning the excessive tax cuts for large corporations and the wealthy and the wasteful use of tax money, including military expenditures, the government, the LDP, and ruling circles are arguing as if an increase in the consumption tax rate is the only possible measure for tax reform. This is nothing but a deception.                                                                - Akahata, September 18, 2007