October 1, 2013

JAMA Comment on Government’s Consumption Tax Hike

Akio Toyoda, Chairman, Japan Automobile Manufacturers Association, Inc

JAMA endorses the decision announced today by Prime Minister Shinzo Abe to raise the national consumption tax rate to 8% in April 2014, as well as the stimulus measures to be introduced to support sustained growth for the Japanese economy.

We particularly welcome the government’s stated intention to revise Japan’s automobile-related taxes, an action which we believe will alleviate concerns about increased burdens on vehicle users and invigorate the domestic auto market, and thereby help pave the way to renewed economic growth. 

JAMA hopes that during its discussions on tax system revisions at the end of this year, the government will resolve to lower the current 5% automobile acquisition tax rate to 2%, expand tax breaks for eco-friendly vehicles, and map out complementary measures for easing user burdens when the consumption tax is raised to 8%.  We also look forward to the definitive elimination of the automobile acquisition tax and a comprehensive revision of Japan’s taxes on vehicle ownership at the time of the government’s projected further increase of the consumption tax rate to 10%.

For its part, Japan’s automobile industry will continue to contribute to the expansion of the Japanese economy through the development of advanced technologies, the training of skilled personnel, and the bolstering of its international competitiveness.