• Kyodo News


The government is developing an all-inclusive tax and social security numbering system it can use not only to collect revenue from businesses, but also income tax and pension premiums from their employees, sources close to the matter said Saturday.

The corporate-numbering system is expected to improve efficiency at local governments and businesses by reducing the expenditures and clerical work expended on such operations, the sources said.

It is also expected to prevent companies from failing to declare income or dodging taxes by allowing the government to get a better grip on their finances, they said.

The move follows a similar decision by the government in December to develop a citizen-numbering system.

A basic bill on the corporate and citizen numbering systems will be submitted to the Diet later this year, source said.

But experts are warning that a brash attempt to consolidate management of corporate and personal data could obviously lead to major information leaks unless advanced measures are taken to prevent privacy breaches from happening.

Currently, the government manages corporate information using several kinds of identification numbers, including different ones for registered companies and for insurers.

Late last year, the government said it intends to assign citizens new individual numbers separate from their existing resident registry identification numbers in order to collect pension premiums and taxes together through a new “revenue agency.”

The citizen-numbering system, which is expected to take three to four years to roll out, is expected to make it easier to introduce income-proportionate pensions and ease the tax burden on low-income taxpayers when and if the tax hike promised by the Democratic Party of Japan in 2009 happens.

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