Japan May Exempt Home Purchases From Sales Tax Rise, Azumi Says
January 22, 2012, 11:00 AM ESTBy Kyoko Shimodoi and Tsuyoshi Inajima
Jan. 21 (Bloomberg) -- Japan may exempt home purchases from any increase in its sales tax, or reduce the amount of increase, Finance Minister Jun Azumi said.
Prime Minister Yoshihiko Noda aims to double the 5 percent sales tax by 2015 to boost revenue and contain a public debt burden twice the size of Japan’s annual economic output. The legislation needs approval of parliament, and Azumi and two deputy ministers are today meeting with taxpayers in three cities to explain the need for a tax increase.
Raising the sales tax would be the first step toward reducing the nation’s public debt and reforming finances, Azumi said today in the quake-stricken northern city of Sendai.
The government forecasts public debt will exceed 1 quadrillion yen ($13 trillion) in the year ending March. The International Monetary Fund has recommended raising the sales tax gradually to 15 percent over several years.
--Editors: Jim McDonald, Paul Tighe
To contact the reporters on this story: Kyoko Shimodoi in Tokyo at kshimodoi@bloomberg.net; Tsuyoshi Inajima in Tokyo at tinajima@bloomberg.net
To contact the editor responsible for this story: Paul Tighe at ptighe@bloomberg.net
