Total tax revenue in the general account in March dropped 18 percent from the same month last year due to special income tax cuts, the Finance Ministry said Wednesday.
Income tax withheld at the source during the month plunged nearly 80 percent to 115 billion yen. On the other hand, consumption tax revenue jumped 31 percent to 277 billion yen, contributing to the month’s total revenue of 2.2 trillion yen. The tax rate was raised from 3 percent to 5 percent in April last year.
The effect of the temporary tax cuts — worth 2 trillion yen, including residential tax cuts — was mainly felt in March, a ministry official said, referring to one of the negative factors. The effect will appear when the statistics for April are released next month. A positive factor will be the additional revenue the consumption tax increase is expected to bring in May, because companies closing their accounts in March pay the tax then, the official said.
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