Japan Press Weekly

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2016 February 10 - 16 [POLITICS]

Toyota, the top donor to ruling party, is the largest beneficiary of R&D tax credit

Recent government data showed that the amount of tax credits for corporate R&D activities in fiscal 2014 reached a record high of 674.6 billion yen. The largest beneficiary, which received 108.4 billion yen in the tax credit, is Toyota Motors, Akahata reported on February 10.

Toyota, which benefited the most from this tax cut measure, is the most generous corporate donor to the ruling Liberal Democratic Party. It donated 64.4 million yen to the LDP’s political fund management body, far exceeding the second largest donor, Cannon, which donated 40 million yen.

After Prime Minister Koizumi Jun’ichiro expanded the scope of the preferential tax measures, the amount of R&D tax credits awarded to companies jumped from around 100 billion yen in 2003 to over 420 billion yen in the following year. The amount of the tax breaks further increased under the government led by Prime Minister Abe Shinzo.

According to government data, large corporations with a capital of more than one billion yen enjoyed 612 billion yen or over 90% of the R&D tax credits.