Hiromitsu Ishi (left), chairman of a government commission on tax reform, hands in the commission's tax reform proposals to Prime Minister Junichiro Koizumi on Nov. 25.

The government has already decided to halve the tax breaks in 2006, which would add ¥1.25 trillion in revenue per year. The proposed shelving of the tax breaks would increase the annual tax burden on a family of four with an income of ¥10 million by ¥178,000.

The panel also suggested an end to special corporate tax breaks -- introduced in fiscal 2003 to boost IT investment -- worth about ¥520 billion when they expire in March 2006.

The commission sidestepped the controversial issue of whether to raise Japan's 5 percent consumption tax rate and did not suggest an immediate comprehensive overhaul of the nation's tax system, although the public debt, the largest in the industrialized world, reached a record ¥795.8 trillion at the end of June.

The Japan Times Weekly: Dec. 3, 2005
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