Japan's government should consider issuing more bonds to finance a planned tax cut, Prime Minister Junichiro Koizumi's right-hand man said yesterday, noting the tax reduction would be followed by hikes in the future.
Taku Yamasaki, secretary general of the ruling Liberal Democratic Party, said a bond issuance and an expenditure cut could be used to finance the planned drop.
"I think [the government] should consider both," he said. "Since we have taken off the ?30 trillion (US$250 billion) cap on bond issuance for fiscal 2003, it is possible to issue `tsunagi' [stop-gap] bonds," Yamasaki said on a news show on the Asahi television network.
Koizumi has said he would abandon the controversial cap on new government bond issues in the next financial year starting in April. The bond limit was a key reform goal aimed at reining in swollen government debt.
"Tsunagi" bonds are government debt issues to fill a revenue shortfall. The bonds are to be redeemed in a short time frame with income from other taxes.
Yamasaki indicated the bond issuance also meant a future tax hike, saying "government bonds need to be redeemed."
"The tax system will be revenue-neutral over the long term as tax rises and tax cuts are handled in a package," he said, adding tax cuts would precede this time.
He also said sales of state-held assets and curbs on government spending would also help make room for lowering taxes.
"We expect the economy will recover meanwhile, increasing tax revenues," he said.
Finance Minister Masajuro Shiokawa on Saturday proposed a tax cut of more than ?1 trillion (US$8.3 billion) mainly in corporate capital spending and research to help spur the country's slow recovery from recession. Koizumi said he is ready for a tax cut but never mentioned its scale.
Shizuka Kamei, former LDP secretary general, told a separate Sunday television programme the government should go ahead with a larger tax cut of around ?2.5 trillion. But a more cautious opinion was heard from State Minister for Economic and Fiscal Policy Heizo Takenaka.
State-run CPC Corp, Taiwan (CPC, 台灣中油) yesterday signed a letter of intent with Alaska Gasline Development Corp (AGDC), expressing an interest to buy liquefied natural gas (LNG) and invest in the latter’s Alaska LNG project, the Ministry of Economic Affairs said in a statement. Under the agreement, CPC is to participate in the project’s upstream gas investment to secure stable energy resources for Taiwan, the ministry said. The Alaska LNG project is jointly promoted by AGDC and major developer Glenfarne Group LLC, as Alaska plans to export up to 20 million tonnes of LNG annually from 2031. It involves constructing an 1,290km
‘MAKE OR BREAK’: Nvidia shares remain down more than 9 percent, but investors are hoping CEO Jensen Huang’s speech can stave off fears that the sales boom is peaking Shares in Nvidia Corp’s Taiwanese suppliers mostly closed higher yesterday on hopes that the US artificial intelligence (AI) chip designer would showcase next-generation technologies at its annual AI conference slated to open later in the day. The GPU Technology Conference (GTC) in California is to feature developers, engineers, researchers, inventors and information technology professionals, and would focus on AI, computer graphics, data science, machine learning and autonomous machines. The event comes at a make-or-break moment for the firm, as it heads into the next few quarters, with Nvidia CEO Jensen Huang’s (黃仁勳) keynote speech today seen as having the ability to
NEXT GENERATION: The company also showcased automated machines, including a nursing robot called Nurabot, which is to enter service at a Taichung hospital this year Hon Hai Precision Industry Co (鴻海精密) expects server revenue to exceed its iPhone revenue within two years, with the possibility of achieving this goal as early as this year, chairman Young Liu (劉揚偉) said on Tuesday at Nvidia Corp’s annual technology conference in San Jose, California. AI would be the primary focus this year for the company, also known as Foxconn Technology Group (富士康科技集團), as rapidly advancing AI applications are driving up demand for AI servers, Liu said. The production and shipment of Nvidia’s GB200 chips and the anticipated launch of GB300 chips in the second half of the year would propel
WAIT-AND-SEE: Last month’s consumer price index came in at 2.8%, which boosts expectations that the Fed would proceed cautiously to lower inflation sustainably The US Federal Reserve is widely expected to keep interest rates unchanged at its policy meeting this week, treading carefully amid uncertainty over US President Donald Trump’s economic policies, which include spending cuts and sweeping tariffs. Since January, Trump has imposed levies on major trading partners Canada, Mexico and China, and on steel and aluminum imports, roiling financial markets and fanning fears that his plans could tip the world’s biggest economy into a recession. The Trump administration has also embarked on unprecedented cost-cutting efforts that target staff and spending, while the US president has promised tax reductions and deregulation down the road. However,
RSS