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2013年12月 7日 (土)

経済対策5兆円 消費増税後の景気失速を防げ

The Yomiuri Shimbun December 7, 2013
Govt must take steps to prevent slowdown after tax hike in April
経済対策5兆円 消費増税後の景気失速を防げ(12月6日付・読売社説)

The government must take every step it can regarding economic management to prevent the national economy from losing steam due to the consumption tax increase set for April.

The government has decided on a package of economic measures in preparation for the tax hike from 5 percent to 8 percent, calling for fiscal spending of about ¥5.5 trillion. If expenditures by local governments and other entities are included, spending will amount to ¥18.6 trillion.

Backed by tailwinds from the Abenomics economic policy promoted by Prime Minister Shinzo Abe’s administration and the weaker yen, the national economy has been picking up but has not yet achieved strong growth led by the private sector. The nation’s exit from deflation is still ongoing as well.

A last-minute surge in demand for durable consumer goods is anticipated ahead of the tax hike, but consumption and investment are expected to turn sluggish in reaction to the tax raise.

According to projections by private institutions, annualized growth in the gross domestic product for the April-June quarter of 2014 is widely anticipated to drop by five percentage points from the previous quarter. It is proper that the government will take steps to prevent the economy from slowing down.

One of the core measures is to utilize corporate vigor.

The special corporate tax for reconstruction will be abolished at the end of fiscal 2013, one year ahead of schedule, to reduce the corporate tax burden by about ¥800 billion, and the financing system to support the operation of small and midsize companies will be expanded. The government will support businesses, as it expects them to be a driving force behind growth.

Companies have roles to play

For their part, companies are urged to actively expand investment and projects. It is hoped that their improved profits will be used to raise wages and expand employment, spreading the benefits to household finances.

The second pillar of the economic measures is implementation of public works projects. The projects will center on safety and anti-disaster measures such as strengthening school buildings’ earthquake resistance and renewal of superannuated roads and bridges.

However, it is worrying that many tenders on public works projects have recently ended unsuccessfully due to a labor shortage and surges in material prices. Smooth implementation of the projects is needed to ensure stimulus measures are effective. It is also indispensable to closely scrutinize the projects to determine which are nonessential and which are nonurgent.

Enhancing the policy to sustain personal consumption will also be necessary to ease the adverse effects of the tax increase. This is because the planned cash handouts to low-income earners, which have been incorporated in the government’s economic steps, are expected to have only a limited effect.

It would be more beneficial to adopt reduced tax rates for such items as food so that benefits can be offered to a wider range of consumers in a lasting manner.

If the consumption tax is to be raised further to 10 percent in October 2015 as scheduled, it will be indispensable to adopt reduced tax rates. The ruling parties need to decide on the introduction as early as possible.

To put the economy on a path to full-scale recovery, it is essential to steadily realize a growth strategy in addition to the economic measures. Deregulation and other reform measures that would lead to expanding new business opportunities must be carried out urgently.

(From The Yomiuri Shimbun, Dec. 6, 2013)
(2013年12月6日01時26分  読売新聞)


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