• Kyodo News


A Tax Commission expert panel will seek a raise in the highest income tax rate to resolve the government’s revenue shortfall, according to a draft set of recommendations made available Monday.

The panel, headed by honorary University of Tokyo professor Naohiko Jinno, has concluded that the government failed to promptly address revenue shortfalls resulting from tax cuts implemented in a series of economic stimulus measures starting in the 1990s, the draft shows.

While reforms have lowered the maximum income tax rate to 40 percent and expanded deductions, the abolition of temporary tax breaks has been delayed, it says.

The panel of 11 scholars and other tax experts, which will soon submit its recommendations to the commission, also said the consumption tax should be raised to finance better pension, medical care and other social welfare benefits.

The draft refers to a need to lower corporate income tax to help companies improve their international competitiveness.

The government will take the panel’s recommendations into account when it works out a package of measures in June on economic policy.

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