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2016/01/08
Edano asks questions in budget committee
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On January 8, in a session of the Committee on Budget in the House of Representatives, DPJ Secretary General Yukio Edano called on Prime Minister Abe and other ministers to give their opinions regarding various current issues.
Despite calls from the opposition parties to convene an extraordinary Diet session last year, as stipulated in the Constitution, the session was not convened. The Prime Minister attempted to justify this with an arbitrary interpretation of the Constitution, stating, “The Cabinet is entrusted with deciding when to convene the next session and provided the regular Diet session is convened within a rational time frame, deciding not to convene an extraordinary Diet session is not unconstitutional.” Edano slammed this response, saying, “We requested you to convene the session in October. Over two months has passed since then. Can you really describe this as ‘a rational time frame’…Mr. Prime Minister, you emphasize ‘the rule of law’ but you have no comprehension of what that actually means.”
Edano moved on to comment on current economic conditions. Prime Minister Abe has stated that “we are no longer experiencing deflation.” However, Edano pointed out that, on the contrary, since last year, the Consumer Price Index has been hovering at around zero (excluding the influence of the consumption tax increase), there has been a marked increase in the number of irregular employees, and furthermore, real wages are lower than they were at the time of the DPJ administration. He said that this situation was nothing for the Prime Minister to crow about. Edano also pointed out that since corporation tax is applied to profits after wages and capital investment costs have been subtracted, the decrease in corporation tax rates will not lead directly to wage increases, commenting, “Instead, the government should have introduced large increases in capital investment tax credits. Reducing capital investment tax credits and lowering corporation tax is moving in totally the opposition direction.”
Regarding reduced tax rates for consumption tax, Edano revealed that, 1) reduced tax rates would benefit households with an annual income of less than 2 million yen by around 8,000 yen per year, while households with an annual income of 15 million yen or more would benefit by around 18,000 yen per year, indicating that the higher the income of the household, the more they would benefit from the reduced rates, and 2) of the 1 trillion yens’ worth of resources to be used to finance the reduced tax rates, the proportion used to finance households with an annual income of less than 3 million yen amounted to no more than 11% of the total. He also commented on the fact that newspapers were to be subject to reduced rates, stating that other daily necessities, for example utilities like gas and electricity, were not to be subject to reduced rates, and stated, “People on low incomes do not have the spare cash to buy newspapers. When you consider such circumstances, I wonder why newspapers have arbitrarily been made subject to reduced rates.”
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