Japan to increase the consumption tax rate by the IMF recommendation

The Japanese fiscal authorities continue to review the tax burden for the citizens of own country. The object of special attention is the consumption tax, which exceeds the figures of 10%.

Recently, the International Monetary Fund noted that Japan should move to a gradual increase in the rate of this tax to indicators of 12.5 and 15% in the nearest future. According to representatives of the IMF, this will help to solve problems with chronic budget deficits.

The IMF notes the Japanese Government should pay attention to the "gradual, pre-announced schedule for increasing the consumption tax rate in the amount of 0.5 to 1.0 percentage points".

IMF officials believe that tax increases should be made at regular intervals, starting as soon as possible, and continuing until the tax mark reaches at least 15 percent.

The latest changes to the tarification system were made in April 2017. Since then, the current consumption tax rate in Japan has remained at 10.0 percent level. Despite attempts by the government to defer or mitigate the tax burden by introducing a reduced sales tax, the IMF calls on the authorities to maintain a “unitary tax structure.”

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