Economic figures released Friday have amplified concerns among government officials and some economists about the extent of damage to the nation's fragile economy caused by the October consumption tax increase.
Households cut their spending for the first time in almost a year in October as natural disasters disrupted business and the sales tax hike, from 8 percent to 10 percent, prompted consumers to rein in expenses.
Household spending dropped 5.1 percent in October from a year earlier, government data showed Friday, down for the first time in 11 months and the biggest year-on-year fall since March 2016 — when spending fell 5.3 percent. The figure was also weaker than the median forecast for a 3.0 percent decline. That marked a sharp reversal from the 9.5 percent jump logged in September, the fastest growth on record as consumers rushed to buy goods before the Oct. 1 tax rise.