Prime Minister Shinzo Abe announced Tuesday he will raise the unpopular consumption tax from 5 to 8 percent on April 1 as scheduled, breaking a powerful political taboo. At the same time, Abe unveiled a 5 trillion stimulus package to offset some of the immediate negative effects of the tax hike, including a 10,000 cash allowance for low earners and various tax cuts totaling about 1 trillion, including temporary ones, as well as 730 billion in tax incentives to encourage corporate investment.
Prime minister abe would raise Japan’s sales tax next year as planned in a bid to tackle the country’s enormous debt, sweeping aside concerns that an increase might put the brakes on the country’s nascent economic recovery. The sales tax increase, which would begin April 1, is set to be followed by a second increase in October 2015 that would take the rate to 10 percent, though the plan allows the government to review the state of the economy before raising the tax again.
(Visited 43 times, 1 visits today)