Why Is a Rise in Consumption Tax a Bad Idea?
The Lower House Election (Part 3)

Why Is a Rise in Consumption Tax a Bad Idea?

“The Liberal Democratic Party (LDP) will not stop at 10%. It’ll continue to raise the consumption tax.”

Prime Minister Shinzo Abe has delayed increasing the consumption tax to 10% for 1 ½ years (the government will do it in April of 2017). However, it’s frightening that he declared his intention to raise the rate to 10% no matter what.

Further, one should also caution that no one in authority is saying that the tax rate won’t be raised beyond the 10 percent figure in the future.

In fact, Sadakazu Tanigaki of the LDP not only emphasized the need for an increase in the consumption tax to 10% in September, he added, “We haven’t yet determined how to pay the debt down,” which suggested that additional hikes in the consumption tax could occur in 2020.

A 70% Consumption Tax Rate Might Be Required to Protect Social Security.

The reason why the LDP insists on boosting the consumption tax is to protect social security. But is it really possible in principle, to solve the enormous burden of social security through the utilization of an overly high rate for consumption tax?

The International Monetary Fund (IMF) provided an estimate of what it would take to address Japan’s burgeoning debt problem, and it concluded that the consumption tax would require a 15% increase.

In addition, a group from Hitotsubashi University has calculated that funding Japan’s future social security payments could require a consumption tax rate of 30 to 40 percent. By 2060, Professor Yutaka Harada of Waseda University suggested that a 68.5% consumption tax would be in order to support various social programs in that time period.


More Corporate Bankruptcies and Larger Unemployment Will Come with Tax Hikes, and the Government Will Need to Raise Further Taxes to Rescue Its Citizens.

Raising taxes will result in increased corporate bankruptcies and unemployment, and politicians will need to raise taxes further in order to “help” their citizens through government hand outs. It will only continue to fuel this vicious cycle. Consumers will grow poorer, and “big government” will be in position to control the livelihoods of all its citizens with a complete victory at hand. Freedom will become a fleeting reality.

In the end, a consumption tax hike could never provide the answer to protect Japan’s social security system, which has problems of it own as well.

In order to increase the government’s coffers, Japan needs a “small government”, which the Happiness Realization Party is in support of and lobbying for. The Japanese economy can grow through lowering the consumption tax back to 5%, reducing the number of government regulations, eliminating inefficiencies within the government’s administration, which includes the elimination of the need to acquire approval in order to build private universities, and the Japanese government must allow its citizens to keep and to use their money as they see fit.



If you’d like to know more reasons why a consumption tax hike would be a mistake for Japan, the staff at the Liberty would like to take this opportunity to encourage you to visit The Liberty Web because they have plans to upload more articles related to the subject. During the election, they will provide articles on the Happiness Realization Party as well as some offerings that will help internet readers to understand Abenomics, the consumption tax, the university approval process, etc.

Thank you for considering a look at the site, here’s the URL.

Why Is a Rise in Consumption Tax a Bad Idea?
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