Japan Press Weekly

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2014 November 26 - December 2 [POLITICS]

Komei sugarcoats proposed consumption tax hike to allay public anger

The Komei Party has recently published its election platform promising to seek an introduction of a lower consumption tax rate on daily necessities in association with the proposed tax increase to 10% from the current 8% in April 2017.

This appears to be a tactic to allay public anger against the higher consumption tax rate because the Komei’s election promise provides no concrete information about how big tax cuts would be, how to secure financial resources for the lower sales tax rate, and when tax cuts will start.

Komei’s organ paper on November 14 reported on the party proposal for a reduction in the tax rate on food items.

According to the paper, the party gives eight examples including ones in which all drinks and food products are subject to a reduced tax rate and only Japan’s staple food of rice is subject to exemption.

Based on the eight examples, if the government maintains the current consumption tax rate of 8% on only rice, the size of tax cuts would amount annually to 40 billion yen, which amounts to only 535 yen per family.

Mainichi Shimbun dated on November 25 revealed that the ruling Liberal Democratic Party was not happy with its coalition partner for giving an election pledge to work for a lower tax rate on daily items.

The Komei Party is obviously trying to sugarcoat the 10% sales tax hike to gain votes.