Japan Consumption Tax rise delay till 2019

Mon 30th May 2016

Close advisors to premier Shinzo Abe indicated this weekend that the planed April 2017 rise in Japanese Consumption Tax from 8% to 10% will be postponed until 2019.

Continuing weak consumer demand, and a slowing Chinese market, had put the rise in doubt for a year. It was part of a two-part planned rise, the first, from 5% to 8% in October 2014, had led to a sharp contraction in the world’s third largest economy.

Any formal confirmation will come mid this week, and will include further structural reforms and a new budget to rekindle to economy.

The rise in Consumption Tax has been long planned, and is principally required to meet the long-term social costs of a rapidly ageing population.