Japan Press Weekly

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2013 September 11 - 17 [ECONOMY]

Is tax burden on wealthy in Japan too heavy?

Matsuura Masato, CEO of major entertainment corporation Avex Group Holdings, on August 8 posted on his Facebook a remark that the tax burden on the wealthy in Japan is too heavy, and the posting went viral.

Is he actually shouldering a tax burden that is as heavy as he claims?

According to a finance statement of his corporation, Matsuura last year received 451 million yen in compensation, which equals 56 times the average wage of his employees. Along with the 187 million yen of dividend income, he earned 638 million yen in total.

The maximum rate of income tax, 50%, is applied only to the compensation, and the dividend tax rate applied to his dividend income is just 10%.

Matsuura’s tax burden, including social insurance premiums, is estimated to be no more than 35%.

Even average workers in Japan pay over 20% of their income in taxes (including health insurance premiums), and business executives pay more than 30%. Compared to these rates, it is hard to say that Matsuura shoulders a heavy tax burden.

In European countries, the dividend tax rate is around 30-40%. Though Matsuura said in his Facebook post, “The Japanese government does nothing for the wealthy,” he obviously benefits from the preferential tax system for shareholders.

Past related article
> Average worker has same tax burden rate as the rich [August 21, 2012]