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INTEREST: Bandai Rolls Out Capsule Figure Cans To Counter Tax Increase

Taxes are going up, but also is the basic wage in most places in Japan. I'm not a specialist, so can someone tell me what's the point of all this?

vallum wrote:

Taxes are going up, but also is the basic wage in most places in Japan. I'm not a specialist, so can someone tell me what's the point of all this?

The last time the sales tax increased in Japan, their economy tanked. So a lot of people are worried that this will happen again, especially as it looks as though consumers are already getting ready to pull back on spending.

Even though the basic wage increased in Japan (only very recently!!!), other things are rising as well, including cost of living. If your wage increase is just going to cover your increase in housing, necessities, etc... you're probably not going to be spending much else on higher-priced goods.

Likewise, companies have been increasing their prices for consumer goods in an effort to keep themselves from getting hit hard April 1 and the months to come. So all around, it's not a good mix.

Increasing taxes is a good thing if you increase government spending as well. Japan isn't as vulnerable as many think it is, mainly because almost all of its sovereign debt is kept by Japanese companies. So the "foreign" market cannot influence the local economy as it does for instance in Europe or the US. Furthermore Japan is one country where the level of saving money is highest in the world.

As for a 3% tax increase ? Give me a break. European states have VAT that varies from 20% to almost 30%. Going from 5% sales tax to 8% isn't going to thrust Japan into poverty. Repeat after me, higher taxes are not inherently a bad thing. Rednecks and tea partiers can jump over the cliff over there ->

ANN_Bamboo wrote:

vallum wrote: Taxes are going up, but also is the basic wage in most places in Japan. I'm not a specialist, so can someone tell me what's the point of all this? The last time the sales tax increased in Japan, their economy tanked. So a lot of people are worried that this will happen again, especially as it looks as though consumers are already getting ready to pull back on spending. Even though the basic wage increased in Japan (only very recently!!!), other things are rising as well, including cost of living. If your wage increase is just going to cover your increase in housing, necessities, etc... you're probably not going to be spending much else on higher-priced goods. Likewise, companies have been increasing their prices for consumer goods in an effort to keep themselves from getting hit hard April 1 and the months to come. So all around, it's not a good mix.

Increasing taxes is a good thing if you increase government spending as well.

Increasing taxes is a good thing if you increase government spending as well. Japan isn't as vulnerable as many think it is, mainly because almost all of its sovereign debt is kept by Japanese companies. So the "foreign" market cannot influence the local economy as it does for instance in Europe or the US. Furthermore Japan is one country where the level of saving money is highest in the world.

As for a 3% tax increase ? Give me a break. European states have VAT that varies from 20% to almost 30%. Going from 5% sales tax to 8% isn't going to thrust Japan into poverty. Repeat after me, higher taxes are not inherently a bad thing. Rednecks and tea partiers can jump over the cliff over there ->

A hike of 3% in national sales taxes that goes into effect on April 1st?

mgosdin wrote:

A hike of 3% in national sales taxes that goes into effect on April 1st?

Japanese financial year is april-to-april, IIRC.

Japanese firms expect 1.5% inflation next year

Officials at Japanese companies are expressing skepticism that consumer prices will rise sufficiently to reach the central bank's inflation target next year.

The Bank of Japan has for the first time used its quarterly Tankan survey on business confidence to ask firms to predict price trends. The survey covers about 10,000 Japanese companies.

Executives say they expect consumer prices to rise about 1.5 percent on average over the next year. They say this prediction excludes the possible effects of the consumption tax hike initiated on Tuesday. Their forecast is lower than the central bank's inflation target of around two percent.

Of the respondents, 58 percent said prices of their own products and services would basically remain the same.

Just over 20 percent said they expect their prices will rise by about 5 percent.


Apr. 2, 2014 - Updated 08:07 UTC

The Korea Institute for Industrial Economics and Trade said in a report that the tax increase from five to eight percent is likely to slow down domestic demand in Japan.

The report said more Japanese corporations are expected to target overseas markets rather than focus on the domestic market.