Consumption tax rate 10% History of the increase October 1 0:43
The increase in the consumption tax rate to 10% was decided in 2012 by the agreement of the then Democratic Party and the Liberal Democratic Party and Komeito Party.
The “Consumption Tax Rate Raising Law” that was enacted clearly stated that it would increase from 5% to 8% in April 2014 two years later and to 10% in October 2015 the following year.
Later, under the Abe administration, the consumption tax rate was raised to 8% as scheduled in April 2014. However, the economy has cooled as personal consumption declined after the tax increase due to the reaction to last-minute demand.
In response to this situation, in November of this year, Prime Minister Abe said that “If it is raised to 10% as planned, private consumption will be pushed down again and deflation will be jeopardized.” We announced a policy to postpone a year and a half until the month.
Furthermore, two years later in 2016, Prime Minister Abe said that the outlook for the economy will become more uncertain, such as the yen's appreciation and stock price depreciation as the Chinese economy slows down and crude oil prices fall. We decided to postpone the tax rate increase again until the month.
After that, the government reiterated that it would raise it unless there was a “Lehman shock class” event that caused a global recession. There was uncertainty about the implementation of the postponement to 10%, which was postponed twice.
However, it has been over 7 years since it was first stated in the law. This time, the consumption tax rate has been raised to 10%.