Fixed-rate tax cuts， subsidies．．． Despite the Kishida administration’s constant handouts， dissatisfaction with the weak yen and high prices has not subsided， and the economic policy is based on “tax increase glasses．”
As the weak yen and high prices have continued for a long time, the Kishida administration has responded to public dissatisfaction by introducing economic policies such as flat-rate tax cuts and subsidies for electricity and gas bills. However, wage increases, which have been the government’s top priority, have not kept up with rising prices, and real wages are down for the longest period on record. When the government was first launched, its “new capitalism” focused on distributing revenue to middle- and low-income earners, but it failed to improve people’s standard of living, and the government’s aim of a “virtuous cycle of growth and distribution” was only half-way there. (Hakusan Izumi, Takada Minori) ◆As support waned, handouts increased Last fall, Prime Minister Kishida suddenly announced a flat-rate tax cut of 3 trillion yen to combat rising prices. The measure allows taxpayers and their dependents to deduct a total of 40,000 yen from their resident and income taxes, but the administrative procedures are complicated. It was also pointed out that this was a way to make up for the criticism that the government was “tax increase spectacles,” and there was a stream of criticism from business leaders, with some saying, “All of this is creating more trouble for Kishida to promote himself.” Subsidies for gasoline, electricity and gas costs, which were due to begin in 2022, have also been extended several times beyond their original scheduled period due to rising fuel prices. The budget allocated amounted to approximately 10 trillion yen. Yusuke Matsuo of Mizuho Securities looks back on the process behind the increase in handout policies, saying, “As support for the party declined due to issues (regarding politics and money) within the party, there was a gradual shift toward policies that were easier to gain support from the public.” When the Kishida administration took office in October 2021, the exchange rate of the yen against the dollar was in the low 110 yen range, but since 2022, the yen has become extremely weak and prices have risen sharply. Despite significant wage increases in spring labor negotiations for two consecutive years, real wages have been declining for 26 consecutive months since April 2010. The government has made efforts to support wage increases at small and medium-sized enterprises, such as by increasing the number of investigators (G-men) who check whether labor costs are being passed on to prices, but it is difficult to say that the scope of wage increases has expanded sufficiently. On the other hand, the weak yen, which has accelerated price increases, is also a “negative legacy” of the Bank of Japan’s continued large-scale monetary easing since the Abe administration. As a result, the Bank of Japan was urged to normalize its monetary policy, including lifting negative interest rates in March and raising interest rates further in July, temporarily putting a stop to the yen’s depreciation. But the policy shift is just getting started. The next prime minister will be faced with the heavy task of dealing with the turmoil in financial markets while also bringing about a return to normalcy and curbing rising prices. Tokyo Shimbun, August 15, 2024, 6:00am.
>>1 There’s no point in raising taxes afterwards And what are you saying when you’re getting a backroom deal? Anyone who votes for the LDP should get out of Japan.
>>1 In the national financial statements for fiscal year 2021, tax and stamp revenues were about 64 trillion yen and social security-related expenses were about 55 trillion yen In other words, 86% of tax and stamp revenues were used for social security-related expenses. In Japan, one third of the population is over 65 years old and their livelihoods are supported by social security, and two people, including people with disabilities and minors, support the lives of one elderly person, so the burden on the working generation is increasing. Political parties that only call for tax cuts without mentioning any cuts to social security spending are just trying to deceive the people.
A tax increase is inevitable next year, so it must have been tough for them to be called “tax increase glasses.” If you support the LDP, it’ll come out of your wallet.
Even if they do hand out money, the scale is small. Try handing out 2 million yen to each citizen, but only on the condition that they spend the entire amount. It would have a frightening effect.
>>15 He was saying good things up until the presidential election, even I, an anti-LDP, had high hopes for him. But in just a few months, he abandoned his campaign promises one after another, and before you knew it, he was being threatened by someone behind the scenes, along with Abe.
Starting in October 2024, companies with 51 to 100 employees will be required to enroll their part-time and casual workers in social insurance. This is a ridiculous tax increase that will squeeze the poor out of us.
>>16 I think this is a good thing. We should break down the income barrier. Take home pay less? Just work more. Also, abolish the third category of insured persons.
>>47 Non-taxable households = old people and old ladies who support the LDP That’s right lol How much more old people does this country need to be saddled with before it’s satisfied?
>>47 When you think of non-taxable households, you think of elderly people living on pensions, but in reality, it also includes people on welfare like me You don’t know when everyone will get their benefits, so it’s best not to criticize too much.
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