Consumption Tax Increase Thread

[jdmvip]

The new bill increases the tax to 8% by April 2014 and 10% by October 2015.

I haven't followed this for awhile but it looks like it's about to happen. This can't be a good thing or small business and Exporters in Japan, it will be a strain on cash flow at 8%. When it goes to 10% that will be a 50% constraint over the long standing 5%.

I predict some of the smaller Exporters will go under from this and it will be a challenge for all of them though.

It really does seem silly to me and the government should have exemptions for people like Exporters. I imagine it's going to be more difficult for them to have float money to buy cars especially during busy times and this may actually reduce overall economic activity in Japan.

Any thoughts guys/Exporters?

[Sastrad]

It really does seem silly to me and the government should have exemptions for people like Exporters. I imagine it's going to be more difficult for them to have float money to buy cars especially during busy times and this may actually reduce overall economic activity in Japan.

Our exemption comes once the product (cars in my case) is exported. We file our quarterly tax and wait (months...) for the return. It does keep money tied up, but its part of doing business.

[Sastrad]

The fact we can get the tax back is a big deal. The only proof of our exporting a product, like cars, is the bill of lading. So, being exempt when buying a product would not be likely.

[jdmvip]

Hey Steve
It is good you guys get it back but too bad you have to wait.

I guess it's better than sales tax in Canada lol.
Any predictions about the impact on the industry?

I think it will strengthen some and expose risky business models of some especially resellers/middlemen.