Japan to Raise Tax Deductions for Wage-Raising Firms
Newsfrom JapanPolitics Lifestyle
Tokyo, Dec. 6 (Jiji Press)--The Japanese government and ruling bloc are considering increasing the tax deduction rate to 30 pct for big companies and 40 pct for smaller ones if they raise wages, sources familiar with the matter said Monday.
Tax breaks for companies raising wages are one of the focuses of this year's annual tax reform discussions and one of the main policies of Prime Minister Fumio Kishida, who aims to ensure a virtuous cycle of economic growth and wealth redistribution.
The ruling coalition plans to adopt a tax reform package for fiscal 2022, which begins next April, later this week.
Government and ruling coalition officials are considering a plan to calculate tax deduction rates based on the increased amount of annual salaries including bonuses. Some say the tax deduction rate for big companies should be based on the increased amount of base pay.
Currently, the maximum tax deduction rate for wage-raising firms is at 20 pct for big companies and 25 pct for smaller ones. Tax breaks for such companies have been in place since fiscal 2013.
[Copyright The Jiji Press, Ltd.]