December 24, 2014

JAMA Comments on Launch of Third Abe Cabinet

Fumihiko Ike, Chairman, Japan Automobile Manufacturers Association, Inc.

JAMA welcomes today’s announcement of the composition of Prime Minister Shinzo Abe’s third cabinet and expects that this group will take swift and strategic action on the many challenging issues now facing the nation.

Under Prime Minister Abe’s leadership, we have high hopes that his administration will, through a comprehensive policy program, steer Japan out of its current emergence from deflation and into a full-fledged positive economic cycle.

Key factors in achieving sustained growth in Japan’s economy are the revitalization of Japanese industry and strengthened international competitiveness.  We therefore look forward to the government’s early implementation not only of economic stimulus measures but also of sound growth strategies.

Japan’s domestic vehicle market remains sluggish against a backdrop of stagnant consumer confidence, a consequence of the protracted impact of the increase in the national consumption tax rate in April this year.  This situation, which prompted the recent decision to delay a second scheduled increase in the consumption tax, underscores the urgent need for the implementation of measures that will promote a general recovery in demand and sustained growth.

With discussions now underway on the government’s large package of tax revisions for fiscal 2015 (starting April 1 next year), we take this opportunity to request, with regard to Japan’s auto-related taxes, the adoption of policies that will lower the tax burden on automobile owners in Japan.  We also advocate a reduction in the corporate tax rate as well as expanded tax provisions promoting increased activity in research and development, to help bolster corporate competitiveness and expedite the transition to long-term growth.

Furthermore, because the automobile industry is deeply committed to global-scale business development, we consider it vital to achieve freer trade and investment based on the formulation of common rules.  We therefore strongly encourage the government to accelerate ongoing talks in order to reach early accord on, in particular, the Trans-Pacific Partnership Agreement and the European Union-Japan Economic Partnership Agreement.