Thursday, November 13, 2014

Consumption tax election by Abe is absurd

Abe administration seems to postpone raising consumption tax.

Consumption tax in Japan has raised since this April by 3%. And it is to be raised again in October 2015 to by 2%, reaching 10%. This scheme was determined in the previous Democratic Party of Japan (DPJ) administration. Ruling Liberal Democratic Party (LDP) also agreed with this idea.

However, once raised, civil consumption was suppressed. Yet there are argument regarding the interpretation of several indexes describing financial situation, Prime Minister Shinzo Abe assessed that further raising tax would interfere inflation, exacerbating the depression.

He plans to dissolve the House of Representatives, to let citizens judge his opinion. The schedule of hiking tax has been consented by the three parties, LDP, DPJ, and Komeito Party. A general election should be done after such a drastic change of the policy, according to Abe.

Regarding consumption tax, I repeatedly described that raising is necessary. Current financial situation cannot be fully explained with hiking tax. Rather, lack of developmental strategy is critical. Weak yen induced by Abenomics is also hostile to fuel import being required due to stasis of most atomic power plants. Pending rising tax must not be a panacea.
The true reason Abe is planning to dissolve the House of Representatives is to restructure of diet members. The term of current representatives will terminate in December 2016. Perhaps, Abe wants  to conduct a general election to strengthen the foundation of the diet.

To begin with,  it is ridiculous to make an election to call for an opinion about raising tax. No one like to pay the tax. Opposing parties cannot debate with taxing as the point at issue. Winning of LDP is guaranteed with 100%. Thus, this election is a waste of time and money.

Some politicians, including Taro Aso, the Finance Minister insist on raising the consumption tax. Haruhiko Kuroda, the governor of Bank of Japan and a strong ally of Abe, is also warning that delaying of the tax hike is a risk to the international trust. Even in the LDP, there is a broad discussion.

I cannot vote this election because I do not live in Japan now. Even if possible, I would not vote to LDP.


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