Japan Press Weekly

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2020 February 5 - 10 [ECONOMY]

Tamura: Gov’t should squarely confront fall in consumer spending caused by forcible consumption tax increase

Japanese Communist Party Policy Commission Chair Tamura Tomoko on February 7 commented on just-released government statistics which shows a continued economic decline. She said, “The Abe government should squarely face up to the fact that the Japanese economic recession has become even more serious.”

Earlier on the day, the Cabinet Office released indexes of business conditions for December 2019 which recorded the fifth straight month of decline. The Internal Affairs Ministry published the results of its monthly survey of family income and expenditure which showed that the average consumer spending per household for December 2019 fell for three months in a row.

At a press conference in the Diet building regarding the continued decline in the business condition index, Tamura pointed out that this is the first time for a prolonged drop since the index fell for eleven consecutive months in the aftermath of the collapse of Lehman Brothers in 2008. Tamura also pointed out that the consumption tax rate increase to 10% brought about a significant setback to the overall household economy.

Pointing out that Prime Minister Abe in his policy speech did not mention the negative impacts of the implementation of the higher consumption tax rate, Tamura criticized the government for being reluctant to face the reality of sluggish consumer spending and stated that this stance is reflected in the 2020 draft budget. She said that the government should revise the budget draft to include measures to boost personal consumption expenditure.

Furthermore, Tamura noted that the government argues that with an increase in tourism associated with the 2020 Summer Games, the economy is in moderate recovery. She said that unless the government abandons such a view, Japan’s economy will enter a disastrous phase of heightened economic slowdown.

Past related article:
> 2020 draft budget sacrifices people’s welfare and livelihoods to fund military buildup [December 21, 2019]