Enthusiasm on Taxation

As appeared on pages of history books, taxation often caused war. Civil wars of Britain in seventeenth century or American Revolution was triggered by heavy tax from oppressive government. However, response of Japanese people to the higher consumption tax rate started Tuesday was not anger, but “inevitable.” The explanation of the government to its citizens looks successful so far.

Media is accomplices of the government on consumption tax. TV and newspapers were enthusiastic in reporting consumers’ voices. Most of them focused on what was happening in grocery stores with 24 hours operation. With efforts for introducing new tax-included prices, those stores were well-prepared in shifting the prices just on twelve o’clock of April 1^st. Appliance stores marked big sales sixty percent more than ordinary level last weekend. Goods with high price, including refrigerators, coolers or computers, were some of the top sellers. Commuters made long lines in front of station offices for purchasing round trip tickets for months.

While most consumers recognized the higher tax inevitable, they do not realize that new tax will not be spent for its original purpose. Although all the increased tax money should be used for social security, only ten percent will be spent for improving social security. The rest will be appropriated to deficit in the pension budget and maintenance of social security system. The consumers cannot expect apparent improvement in social service of the government. Moreover, medical payment for agers of 70 to 74 and pension fee for all will be increased from April.

In spite of new burden to all families, balance of national budget will not be change. Cumulative deficit will not be reduced, since the leading parties still insist on Keynesian economics with heavy dependence on infrastructure. Deficit being handed over to future generation is still getting increase. If Japanese people think this tax hike necessary, they will be as obedient as a herd of sheep.

Prime Minister, Shinzo Abe, is worrying about the impact of backlash of current positive purchase of consumers. He required the nation to keep optimistic mind. It is not their mind, but your mind, Mr. Prime Minister. Artificial commodity price hike led by Abe and the Bank of Japan will put further burden on the people. Its benefit is going to exporters, because the result of policy is mainly the cheap yen and high-priced dollar. Abenomics has not reached its goal.

The government is planning further consumption tax rate, from 8% to 10% in October 2015. If the people still think that inevitable, they will never be able to escape from economic oppression of the government.