Today, the LDP and KOMEITO announced the next year’s Tax Reform Proposal has been finalized. Seeing the proposal, there are some points that I would like to refer here.
One of the feature is reducing the corporate
tax down by 2.51%. This is the very PM Shinzo Abe’s 3rd arrows in order to
strengthen Japanese business entities and also aiming to invite foreign
investments to Japan.
However, I wonder this would really work as
planned because the ruling parties also mentioned to apply the external
standard taxation system to the smaller business entities at the same time. As
the external standard taxation is severer to business by imposing tax on loss
makers while corporate tax is only imposed on profit makers.
Actually, Tokyo stock market did not go up
on the final day today on the contrary to expectation of the tax reform news. I
believe many investors already know that it does not give an impact on pushing up
Japanese market higher.
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