Press translations [Japan]. Economic Series 0164, 1946-01-14.
Date14 January, 1946
translation numbereconomic-0765
call numberDS801 .S81
Persistent Identifier
ECONOMIC SERIES: 164
ITEM 1 Lectures for Women Voters - Part III - Bonds and Taxes by HASEDA, Taizo - Provincial newspaper The Kahoku Shimpo (Sendai) - 8 Jan 46. Translator: T. Okamura.
Summary:
Let us look at the issue of war bonds in JAPAN. Since the outbreak of the CHINA Incident
JAPAN issued bonds totaling some 120
billion yen, and the debts amounted to some 40 billion yen. These debts were made
mostly through the Southern Development Bank
(NANFO KAIHATSU KINKO) and similar organizations, and these debts were incurred for
mobilizing all materials and labor in
these territories. The total amount of national bonds issued by the end of the 1945
fiscal year and not yet redeemed is
estimated to surpass 156 billion yen. This means that since the outbreak of the CHINA
Incident in March 1937, the amount
increased by 12 times, since the bonds then were calculated at 13 billion yen, as
interest on the 156 billion yen of bonds.
The Government must pay 5,700,000,000 yen annually.
The five-year financial plan, which has been released, estimates the ordinary annual
revenue on the present tax system at 12
to 13 billion yen, and the sum of interest which the Government has to redeem yearly
is to be paid by half of the total tax
revenues. The present tax rate is by no means low. If the time comes when there is
a postwar business depression, and prices
of commodities go down, the revenue through taxes will be decrease, while the bonds
will remain at the some amount. In such
cases, a majority of the State revenues must be utilized for the payment of interests
on bonds. When half of the State revenue
from taxes are spent for such payment, the Government will be obliged to restrict
other expenditures. The Government will be
placed in a difficult situation, which will not allow the conduct drastic enterprises.
In short, the gradual accumulation of
bonds means a heavy burden for the Government in postwar times, the settlement of
which is understood to be the first step for
economic recovery of a new JAJAN. What the Government is confronted with at present
are not only that problems of redemption
bonds, reparations, postwar reconstruction, and unemployment, but many other serious
problems. In this connection, the
solution to the bond problem must be taken up immediately. The Government plans to
solve this problem by the introduction of
new property taxes and war profits taxes.
I would now like to go into a short explanation of the capital levy. The property
tax is divided into ordinary and
extraordinary taxes. The former is levied annually at the rate of 0.1 or 0.2 per cent
of the value of individual property,
while the latter is levied only once, but on a high rate. This tax is usually levied
as an emergency measure during a
financial crisis in a country. The objective of the capital levy is to collect at
one time a great sum of money in order to
redeem bonds
ECONOMIC SERIES: 164 (Continued)
ITEM 1 (Continued)
or to pay for important defence equipment. After World War I, a few countries introduced
the property tax, but the most
interesting example was when the British Labor Party advocated the enforcement of
the new tax to w[illegible]the general election after the end of the war. According to the plan advocated by
the Labor Party of ENGLAND, a 5 to 60 per
cent tax was to be levi[illegible]on individual property of over 5,000 pounds in 11 graduated rates. The
ai[illegible]was to collect three billion pounds at half of the total bonds, other than those owned
by
the UNITED STATES, and at the same time to save 150 million pounds, which was essential
for the payment of interest at the
rate of five per cent a year. The tax money to be collected would be based on statement
submitted by individuals, and the
revenue authorities would conduct investigations to ascertain the correctness of statements
and fair valuation of properties.
The property tax provided many difficulties in ascertaining the correctness of statements
and the valuation of properties, but
the Party insisted that the proposed tax was not so difficult since the revenue author,
ties had long been handling the
property inheritance tax in ENGLAND. The payment of such a tax would be made in cash,
but payment in bonds or similar medium
is usually permitted. The plan provided that tax payment must be completed within
one year after the enforcement of the new
tax. These programs of the plan contemplated by the Labor Party could not be put into
force due to obstruction by the
conservatives and other political parties that time. Consequently, we could not see
the outcome of the plan.
It is advisable to enact the property tax at the earliest possible date after the
termination of war; in other words, it is
better to enforce the tax while the prices of commodities are high. In such time,
the tax revenue will amount to as great sums
and the amount of redemptions of bonds will be great; thus the saving of interests
will be most effective. On the other hand,
the further the prices of commodities decline the more difficult the tax collection
will be.
JAPAN plans to collect 70 to 100 billion yen by the enforcement of the property tax
and the individual property increase tax,
thereby redeeming the major portion of the issued bonds, and saving around 3,700,000,000
yen in payment of interests upon such
bonds. The writer would like to advise the Government to enact the new taxes at the
earliest date to gain the project effects.
It is also worthwhile noting that such taxes will play an important role in preventing
inflation booms, and also in effecting
a fair redistribution of capital among the people of the NATION.
Much anxiety is being attached to the blow to be struck at economic circle in connection
with the enactment of the new taxes,
but it is only natural entertain such anxiety in view of the hugeness of the amount
of taxes to collected. However, we are of
the opinion that the introduction of such taxes have nothing to do with land, buildings,
machinery, vessels, vehicles or raw
materials, vital for economic stability. The enforcement of such taxes will never
cause serious effects upon the production of
such commodities. Caution, however, must be taken in not to invoke friction by the
enforcement of the taxes, for large amounts
of money are expected to move, though temporarily, and frequent transfers of the ownership
of large sums of money are
anticipated after the enforcement of the project. The greatest obstacles to the enforcement
of property taxes are not only
technical difficulties in collecting taxes or such financial hindrances, but political
influences are also great. For this
reason it is advisable for the Government to require the greatest co-operation of
the Nation. The proper tax is by no means
the best measure to meet the postwar financial situation but the success of the levy
of such taxes will greatly contribute
toward the financial and economic adjustment and reconstruction of JAPAN.
ITEM 2 The Agreed Price of Vegetables to Come into Effect as From 13 Jan - Asahi Shimbun - 12 Jan 46. Translator: K. Soto.
Summary:
With the coming of winter the supply of vegetables is getting short, and their price
keeps rising daily. In order to prevent
this and improve the situation, a meeting of producers, consumers, and the representatives
of Green Grocers Control Company
and the Consumers Corporation was held under the auspices of the Metropolitan Office.
As a result an agreed price of
vegetables was established to be enforced from 13 January. This agreed price will
be set by taking into consideration
th[illegible]
- 2 -
ECONOMIC SERIES: 164 (Continued)
ITEM 2 (Continued)
the conditions of production, consumers, and the general situation when vegetables
appear in the market. The total amount of
vegetables that will be available to Tokyo in January is 1,800,000 kan, and it will
amount to 20 monme per person. The
wholesale price of radish will be 8 yen per kan and, adding 20 per cent commission
to this, the retail price will be 9.60 yen.
On the whole the price will be fixed on the basis, and there will be a little fluctuation
according to the quality of the
products.
ITEM 3 The Information Office buys wheat on black market The Teller suspicious of fraudulences - The Xomiuri-Hochi - 12 Jan 46. Translator: T. Ukai.
Full Translation:
It has been reported that a number of the personnel of a governmental office has
taken to the black market, purchasing a large
amount of cleaned wheat and distributing it among themselves. Taking into account
especially the point that the black
marketeers are authorized officials of the Information Bureau, the public Procurators'
Office showed deep concern and asked
for the personal appearance of Messrs. NAGAI, Tokuichi (60 Year old), SHIMADA and
SAKANO, managing director and director
respectively of the SHOWA Industry Company (SHOWA KOGYO), KYOBASHI Ku, processor and
miller of cleaned wheat, and, naturally,
a certain sectional chief of the Information Bureau. The examination has been going
on since the end of last year and is
likely to assume serious proportions.
It is explained that the said Company offered for sale 100 bales of cleaned wheat,
originally committed to its care by the
Food Administration Association (SHOKURYO EIDAN), at about 300 yen per bale, to the
Information Office. Further, it has been
learned that the said firm had resorted to the black market with wheat-flour, "ame"
(wheat-gluten or glutinous rice-jelly),
etc, making an easy profit. They are also being questioned about suspected business
fraudulence, such as giving short measure.
The sectional chief and the personnel concerned the Information Bureau have been called
to account and asked by President
KAWAI of the Office to send in written explanations. They have been reprimanded. One
of the subordinates of the Office says
that the purchase had been paid from the pocket money of the president.
ITEM 4 The New Taxes - Part I - Commentary by WATANABE, Kikeizo - Nippon Sangyo Keizai - 12 Jan 46. Translator: T.Kitagawa.
Summary:
The bills for the personal property tax and the war profits tax on corporations were
released by the Finance Ministry
Thursday. The property tax aims at stabilization of JAPAN'S economy and finance, which
is presently in utter chaos, by drastic
taxation of the Nation's property. It also aims at checking further inflation.
- 1.General provisions.
- a.Tax payers: Both individuals and corporations are subject to the tax. In the case of the former, persons subject to the tax are those who have lived in the jurisdictional area for more than one year on the day of investigation or those who have personal properties in the jurisdictional area. In the same way, corporations which have their main office or properties in the jurisdictional area on the day of investigation are subject to the tax. The day of the investigation has not been fixed yet. But following the French example, the last day of old yen conversion into new yen will probably be set for the day of investigation. All of the property of those who have been within the jurisdiction more than one year will be taxed, but properties belonging to foreigners are subject to the tax only when they have properties in the jurisdiction. - 3 -
- ECONOMIC SERIES: 164 (Continued) ITEM 4 (Continued) Individuals who have properties in the jurisdiction but do not have their residences, or those who have not been more than a year in the jurisdiction will also be treated as foreign, nationals; that is to say, their properties are taxable only when they are within the boundaries of the jurisdiction. Overseas properties, whose owners are not in the jurisdiction on the day of investigation, however, will be taxed if they return within three years after that date. Juridical persons who have their main office in the jurisdiction on the day of investigation will be taxed on all the properties they have on the day of the investigation. By a juridical person is meant not only corporations but also juridical persons for the public benefit or functions.
- b.Location of properties: No question will arise as to the location of movable properties and real estates. Ships are regarded to be located in the place of registry. As to other properties, unless stated differently, in receiving credit at a bank, for instance, the bank will be the location of properties. Properties in general are presumed to be located where their owners live.
- c.Owners: Cases such as properties in trust or life insurance contracts in which more than one person is entitled to a certain credit will be treated as follows: The bill provides in case of trusts that beneficiaries are the owners of the properties, and consignors are the owners when no beneficiaries are stated in deeds. Trustees will be the representatives of financial functions. As to common trust funds, beneficiaries will be the owners of the properties. In cases of postal annuity, mutual financing association contracts not yet due, or life insurance contracts not yet paid, contractors are presumed to be owners of the properties.
ITEM 5 Large Catches of Cuttlefish at CHIBA Coast - Nippon Sangyo Keizai - 12 Jan 46. Translator: R. Aoki.
Full Translation:
From the first days of the new year great schoals of cuttlefish like surges of golden
waves, have begun to approach as near as
two miles off the shores of the fishing towns of KAMOGAWA, AMATSU, and KOMINATO of
CHIBA ken. They are so abundant that even
ordinary fishermen with fishing tackle can catch from 50 to 80 kan a night. This is
really a large catch.
Yet, probably because of the inflation, the price does not show any sign of breaking
but holds to the spot prices of from 70
to 80 yen per kan. Thus, a fisherman makes from 3,000 yen to 6,000 yen a night, and
the proverbially poor fishermen of that
District are now raking in considerable fortunes. This condition exists to such a
degree that the sudden prosperity of
fishermen tends to raise the black market price of rice in the nearby villages and
is confusing the conditions of the
locality, where the record of rice delivery to the Government has not been good for
a long time, even without the new
developments.
DISTRIBUTION "X"
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