Press translations [Japan]. Economic Series 0232, 1946-01-30.

Summary:

Some younger leaders of the business world have asserted that conservative influence should be abolished for complete democratization. They think the national life is being threatened by accelerated inflation and production sabotage by conservative enterprisers. If the present state of affairs continues, disaster is inevitable. To rescue the national life from the verge of havoc and to reconstruct a healthy post-war economy, it is very desirable to sweep away the conservative influences remaining in the business world. For this purpose, the younger leaders of modern thought need to combine.

Regarding this problem, some younger leading business men spoke as follows: Mr. SAKUTA, chief of the administration section of the NOMURA Mining Company (NOMURA KOGYO)—No anachronistic brains can set in motion the task of our post-war economic rehabilitation. Unless the war leaders are removed from their leading posts, no economic reconstruction will be possible. There can be no alternative to removing conservative influence for the socialization of enterprise.

Mr. USHIYAMA, chief of the accounting section of the FUJI Industry Company (FUJI SANGYO)—I doubt whether the current leaders of business fully realize the defeat. To manage a new era, economic morale, economic organization and social system must be brought under criticism without the least leniency.

Mr. SAITO, chief of the accounting section of the KAYABA Industry Company (KAYABA SANGYO)—Progressive leaders in their forties must solve pressing economic problems for economic reconstruction, working with each other. It is beyond the reach of past enterprisers to study and criticize "how enterprise should be conducted".

Mr. OGAWA, of the MITSUI Chemical Industry Company (MITSUI KAGAKU)—The Important Industry Consultative Association (JUYO SANGYO KYOGI-KAl) is told to help in the formation of a club by younger leading business men. I hope they will not become narrow-sighted. It is desirable for the club to represent professional spheres. Thus we can see that our hopes must depend on the younger leaders of about forty years of age.

Summary:

The Social Democratic Party spokesman, Mr. MIZUTANI, expressed his view on the three new taxes as follows. "Vicious inflation must be subdued at the expense of the bourgeoris class. In other words, the Social Democratic Party proposes (1) a wholesale confiscation of wartime profits and (2) cancellation of all Government obligations

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promised under the supposition that JAPAN would win the war, such as compensations to war industries and national bonds in large lots. This is the reason why we have been insisting on the levying of a property and a wartime profit tax.

What matters most is how the expected revenue from these new taxes, estimated at about 100,000,000,000 yen, is employed. The government is intending to employ it for the redemption of bonds and compensation to war industries. The Social Democratic Party strongly opposes such a plan of the Government and insists that the revenue from the new taxes should he employed entirely for rehabilitation, unemployment relief and improvement of the national livelihood.

"The exemption limit of the Property tax must be raised from 20,000 yen and at the same time the taxation rate on higher evaluations must be raised to 70 or 80 per cent. The taxes will not be effective unless they are collected immediately. Withdrawals of bank deposits for evading the taxes have been increasing of late. We regard it as sabotage on the part of the government that no restriction has been put on bank deposit withdrawals. A few days age, the authorities of the Bark of JAPAN expressed their opinion that redemption of bonds by the revenue from the Property tax will not favor the rich. That is quite typical of reactionary opinions."

The Liberal Party's opinion is as follows. "The Liberal Party agrees in principle with the new taxes. They should be collected promptly and skillfully. Otherwise, they cannot attain their principal aim of preventing vicious inflation. Secondly, much care should be exercised in collecting the Property tax so that it doesn't retard industrial revival. Thirdly, a raise of the exemption limit of the Property tax as well as fair assessment of property is absolutely necessary. Fourthly, the revenue from these taxes should be employed for the public welfare, for instance unemployment relief, social insurance and so forth. It may be understood that a part of the revenue will be employed for the redemption of bonds. In that case, however, a blockade of the fund should be executed."

Mr. TOKUDA, Chief Secretary of the Communists Party expressed his view as follows. "The revenue from the three taxes which is estimated at 100,000,000,000 yen must be employed solely for the elevation of the living standard of the people. Nevertheless, the government plans to employ it for the redemption of bonds and compensation for war industries. This means profit for large financial and newly-arisen industrial cliques at the expense of the masses. According to the government plan, about 46,000,000,000 yen will be paid to industrialists as reimbursement, while the tax to be collected from them is estimated at only 25,000,000,000 yen. The Government makes a mockery of the people. Wartime profits should be entirely confiscated from the industrialists and all the receipts should be employed for the interests of the war sufferers, demobilized servicemen and starving repatriates overseas.

The Communists Party strongly opposes the relief of the ZAIBATSU by means of tax revenues. If they would be employed to indemnify war industries, a drastic measure to freeze and confiscate the fund should be taken. It is evident that about 90 per cent of the bonds are held by the Imperial household, financial organizations and large capitalists. These bonds should be taken over without compensation. Further, we insist that all the blackmarketing funds of large capitalists and landowners should be instantly frozen. Thus, the Communist Party regards the government which plans to employ the tax revenue for the redemption of bonds as an enemy of the people."

The following is the Progressive Party's view. "The new taxes are measures best suited for the prevention of vicious inflation. It is

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unfortunate, however, that the new tax laws will not be put into effect earlier than next May, as signs of inflation are seen everywhere in the financial world. The Progressive Party is doubtful about the following points in the Government's plan. "(1) It is doubtful whether or not the revenue from the new taxes will reach 100,000,000,000 yen as the government estimates. (2) Sudden changes in financial and economic conditions might possibly occur before investigations of properties of corporations and individuals are completed and consequently the tax might become impossible to impose. (3) Is the present taxation office capable of attaining the aim of this large scale taxation? (4) Many difficulties may be experienced in collecting these taxes, as the moral standard of the public is getting worse.

"Aside from these doubts, the party insists on:—(1) The exemption limit of 20,000 yen is not appropriate to the present social and economic condition and it should be raised. (2) The taxation rate on a graduated scale should be revised, so that much more money might be gained from propertied classes with 1,000,000 to 3,000,000 yen and upwards. (3) In order to assure fair assessment, a democratic assessment commission made up of committees selected from civilian experts must be established. (4) Much care should be exercised in collecting the taxes so that their collection may not result in the exhaustion of industrial funds. Otherwise, the principal aim of the taxation to prevent inflation cannot be attained.

"The revenue from the taxes may be used for redemption of bonds. We do not think that the redemption of bonds will necessarily favor the rich alone. However, a measure should be taken to block the funds obtained as a result of redemption of bonds."

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