Consumption tax cut is necessary to protect people's livelihoods

Japan Press Weekly

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

Consumption tax cut is necessary to protect people's livelihoods
- Akahata editorial (excerpt)

The Hatoyama Cabinet will draw up a draft to reform the present tax system by the end of this year. Regarding this move, the Japan Business Federation (Nippon Keidanren) headed by Canon President Mitarai Fujio in its tax reform proposal published on October 2 again demanded that the government increase the consumption tax rate to 10% by 2015 and to 17-18% by 2025, and cut the effective corporate tax rate by 10%.

Business circles' greedy demand is unacceptable

On the grounds that the Liberal Democratic and Komei parties had policies that primarily benefited large corporations while victimizing the general public, voters delivered a severe verdict on the LDP-Komei bloc in the recent general election. It is unacceptable that Nippon Keidanren again tries to force the government to meet its shameless demand.

As the reason for a consumption tax hike, the Keidanren proposal cited the cost for social welfare services. In the proposal, Nippon Keidanren insisted that compared to other taxes, the consumption tax "doesn't give much impact on economic growth" and is "the most suitable source of revenues for welfare programs which people can share the financial burdens."

The government has kept saying that the consumption tax revenue would be used to improve "welfare services", but, in fact, most of the revenue in the past two decades was used to provide tax breaks for large corporations.

In order to conceal this "mechanism" from the public, the LDP-Komei government had invented a tactic that appears to use the consumption tax revenue to improve social service programs, using other tax revenues to give more tax breaks to big companies.

It is necessary to change the taxation policy

An opinion poll conducted by the Japan Center for Economic Research just after the general election showed that the majority of respondents, especially 70-80% of those who voted for the Democratic Party of Japan, said, "The government should impose higher rate of taxes on the wealthy and on large enterprises for funding pension benefits and medical service programs."

The need now is to change the taxation policy to the one which reduces people's hardships. Let's increase the public pressure opposing a consumption tax increase and calling for a consumption tax cut in daily necessities, particularly food.

- Akahata, October 5, 2009