Tuesday, November 30, 2010

The DPJ scales back the corporate tax cut

In Japan, the Tax Commission decided against reducing the corporate tax rate by 5%. Instead, they decided the corporate tax rate should be cut by 3% or 4%. Previously, the commission had thought about funding the 5% tax cut by imposing a tax on naphtha and by imposing another tax on research and development. However, the commission backed off of those proposals after a backlash from the Japanese corporate sector.

Back when this discussion was taking place, I remember wondering why Japan would want to impose a tax on naphtha when the Japanese corporate lobby had claimed the tax would destroy the petrochemical industry in Japan. After I asked myself that question, someone, in an East Asian accent, “told” me that America wanted to remove the tax exemption to destroy the petrochemical industry in Japan. Immediately after I was told that, someone with an American accent, in my mind, said, “Hey!” Apparently, this was not information that America wanted disclosed.

But I just disclosed that information. On the web.


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