Japan tax panel recommends increasing burden on wealthy

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TOKYO, Dec 13 (BestGrowthStock) – Japan’s tax panel agreed on Monday
to propose increasing the tax burden for the wealthy as the
Democratic Party-led government tries to secure funds for its
welfare spending programmes.

It is unclear whether the bills to make this change to the
tax code will get through parliament because the Democrats need
the support of opposition parties to pass laws due to a split
parliament.

Some of the increased tax revenue could go to a Democratic
Party scheme that pays allowances to people raising children, a
policy that some opposition parties have criticised.

The tax panel proposed capping personal income exemptions for
people who make 15 million yen ($178,600) or more a year. The
plan would scrap exemptions for families with adult dependants,
excluding students, the elderly and those with disabilities.

That would lead to a 210 billion yen increase in tax revenue,
according to Parliamentary Secretary of Finance Motoyuki Odachi.

The plan would also overhaul inheritance taxes by decreasing
deductions and increasing tax rates, leading to a 260 billion yen
increase in tax revenue.

The government is likely this week to compile tax and budget
guidelines so it can prepare the 2010/11 budget by the end of the
year.

The Democrats have repeatedly pledged to stick to a 44
trillion yen cap on new bond issuance and a 71 trillion yen
spending target, excluding debt servicing costs, for the fiscal
year starting April 1.
(Reporting by Stanley White; Editing by Joseph Radford)

Japan tax panel recommends increasing burden on wealthy