Japanese Businesses Rushing to Cope with Tax Cut

Tokyo, Aug. 6 (Jiji Press)--Japanese businesses are rushing to cope with a consumption tax cut on food from 8 pct to 1 pct that will be implemented for two years from next April.

Restaurant operators are poised to expand take-home meals, such as bento boxed meals and other precooked dishes, to cope with a wider tax gap between eat-in meals and takeout foods.

They are concerned that customers may end up refraining from dining out, as the consumption tax rate will remain at 10 pct on eat-in orders. The tax rate gap between eat-in meals and precooked foods sold at convenience stores and supermarkets will broaden to 9 percentage points from 2 points.

"This is extremely difficult. Restaurants will lose customers," said Miki Watanabe, chairman and CEO of Watami Co., an operator of "izakaya" Japanese-style pubs.

Zensho Holdings Co., which operates Sukiya "gyudon" beef-on-rice restaurants and other chains, intends to expand take-home and delivery food services. "We are ready to accept any circumstances," Chief Financial Officer Kiyohiko Niwa said.

[Copyright The Jiji Press, Ltd.]