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Surprisingly, the consumption tax (CT) was raised from 5% to 8% in April 2014. CT (Consumption Tax) hike has presses back the timing of Japan's complete exit from deflation.

The adverse impact of the CT hike turned out to be worse than what the government or the BoJ had anticipated.

As a result, the CT hike created a cautious business sentiment, Earlier we already saw the net domestic fund demand shrunk to 3.3% of GDP. This indicates a weakening of reflationary momentum.

On a technical front EURJPY has been maintaining continuation pattern in short term trend as there is no trace of reversals. Relative strength index is converging the price sentiments in the trade of this pair. Fast stochastic also does not evidence any reversal signals. Hence, we believe it would still be a buy from us.

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(Source: http://fxwire.pro/Japanese-tax-regimes-depress-economy-36039)

The poor japs have been stuck with their crisis for ages, but at least and as opposite to most other "unions" out there, it's their own money debt, they don't depend from other countries and can afford taking certain measures that others cant.

Actually 8% tax isn't much, when most European countries have 20%+ VAT.

Their tax is quite high considering the average wages. Having been said Japan are quite developed and for a country of their calibre 8% isn't that bad.
However, as with all countries, tax can be a bad thing when it's charged too heavily.
The Laffer curve demonstrates the point at which everyone pays tax when it is set at not too high and not too low a price. However, when the tax charged is too high, people begin moving away and looking for ways to avoid and evade paying tax. It baffles me why the UK government haven't actually noticed this yet...

Yeah, actually its low as hell, I can't think a single European country that has single figure VAT without having to google/wikipedia it. On top of my head all are like 12+% maybe 14 on average.

Our sales tax here is 8%, and income tax is variable depending on how much you make.  I wonder if the total tax is more or less in Japan?  Do they have property tax as well like we do?  My taxes seem high to me but maybe I have it good.  I can never tell.

i just checked the taxes for euro and i'm shocked, some of them reach 50%, wtf, living in japan in comparison is like living in a paradise

Japan needs high taxes to keep its economy alive. It should be remembered that Japan produces hardly any petroleum or natural gas on its own. It imports these commodities from outside, at exorbiant prices. For example, Japan imports (liquified) natural gas at $650 per thousand cubic meters from Qatar, while Ukraine gets the same from Russia at $215 per thousand cubic meters. These imports eat up a lot of Forex. All the taxes collected from other sources are used to subsidized the manufacturing sector, which is the main source of Forex for Japan.

Japan spends almost $200 billion on importing gas and oil. And we wonder why the economy there is going downhill.  ;D

You need to look at all taxes. Some countries tax this and dont tax that. And changing this takes long time. In my country when country need money they just tax oil. Oil is easiest to tax since almost no one will complain.

At least japan is dealing with his own debt, which is in it's majority all internal debt. It means it owes money to his own country only. Meanwhile, most nations out there are stuck in debt that they owe to other countries, which is a much trickier situation.

There are benefits to owning most of your countries debt, it does make me wonder what it will take to break the deflation cycle in the country that said it is still a strong country in the sense the standard of living is high.
Perhaps the revenue from the consumption tax will show stronger economic benefits in the long run through good old capital accumulation.


Oilprices have stabalized around $60/barrel and LNG projects they were working on are less profitable at present so at least their fuel costs are dropping once their future contracts expire, Japan likely hedges their assets to secure import costs.

On the other hand they still need to import a lot of beef and food and given the exchange rate and purchasing power decreasing as a yen is worth less some of that rise is offset and shifted elsewhere instead, then offset by exports, economics can be fun.

The japanese have been fucked several times by natural catastrophes, then the fukushima stuff was terrible. If they had better look with their climate, they wouldn't be on that situation, or not as bad.

Yeah but in a lot of European nations they get more for their taxes. I would rather be taxed like the European nations in the United States and get similar service than what we are taxed at now. The U.S. taxes barely go to helping the U.S. people.

Those events are a huge setback.

I remember hearing it took like $100 mill minimum I think just to clear the aftermath of what happened, and its sad. Of course, japan is an island so this is never going to change, but maybes its a sign for them to ask for foreign debt..

Check the consumer taxes for the Dutch population. Insane... Especially the special "added taxes" on stuff like alcohol, sigarattes, gasoline and even cars.. Our cars are 20-30% more expensive than in Belgium or Germany ffs...

Of course this is all based on a lawmakers passing something, but I disagree taxing oil isnt enough.

All forms of tax is based on daily consumption, which what you see on your reciept.

Oh so that's why usdjpy did that shit, thanks banks and thanks to trading forex with btc, that paid my rent. lol