INTERVIEW: U.S. Economist Sees Oct. 2019 Tax Hike as Appropriate
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Tokyo, Dec. 18 (Jiji Press)--Adam Posen, president of the U.S. think tank Peterson Institute for International Economics, views the timing of the Japanese consumption tax hike set for October 2019 as appropriate.
"It is a good time" for Japan to raise the tax to 10 pct from 8 pct, Posen said in a recent interview.
Additional fiscal spending to cushion the impact of the tax hike would limit an expected decline in consumption, while expenditures related to the 2020 Tokyo Olympic and Paralympic Games would continue, he said.
Posen also said the global economy will likely be relatively strong next year and give a tailwind to the tax hike.
The Bank of Japan's policy of buying Japanese government bonds to guide 10-year JGB yields to around zero pct is "very smart," Posen said.
[Copyright The Jiji Press, Ltd.]