Focus on tax incentives, etc. for tax incentives

Focus on tax incentives, etc. to invest in corporate reserves Beginning tax adjustment discussion November 21 20:21

The Liberal Democratic Party tax examination committee started full-scale discussions on the 21st in preparation for tax reforms for the next fiscal year. The focus will be on tax incentives to create an environment where corporate retained earnings are invested, and income tax reduction measures for unmarried single parents.

The Liberal Democratic Party's tax examination committee held a general meeting on the 21st, and Chairman Amari said, “It's time to start. I want you to have a responsible and deliberate discussion. "

The tax investigation committee focuses on tax incentives when large companies invest in venture companies to create an environment where internal reserves of companies can be invested.

In addition, in order to promote the introduction of the next-generation communication standard “5G”, the policy is to consider preferential measures such as corporate tax for businesses that have been developed with the base station ahead of schedule.

Meanwhile, the Komeito tax investigation committee also held a general meeting on the 21st. Representative Yamaguchi said, “The remaining important issue is how to deal with unmarried single parents. It is necessary to draw conclusions that can be obtained. "

Komeito is a policy that requires unmarried single parents to apply measures to reduce income tax, as well as single parents who died or divorced from their spouse, and adjustments are expected between the Liberal Democratic Party and the Komeito Party is.

Prior to this, Prime Minister Abe, who had a meeting with Chairman Amari, said, “There are various difficult issues, but I would like you to make adjustments within the ruling party and put them together.”

The Liberal Democratic Party tax examination committee will compile the tax reform outline on the 12th of next month.

Aso Deputy Prime Minister and Finance Minister “Tax System Without Unfairness”

Aso deputy prime minister and finance minister greeted at the beginning of the meeting, “I would like you to consider an effective and meaningful mechanism for policy issues such as utilizing retained earnings and promoting investment for growth. I want to ask for consideration so as not to cause discomfort and unfairness among the people in the form of preferential treatment of certain people. "Said.

Encourage large companies to use retained earnings

One of the focus of the tax reform next year will be to create an environment that allows companies to retain their internal reserves for investment.

Of the profits that companies have earned in their businesses, retained earnings, which are not stored in dividends, but remain as internal reserves, the so-called “retained earnings”, were back to 463 trillion yen last year against the backdrop of strong corporate performance. Inflated.

The Liberal Democratic Party chairman of the Amari tax system wants to build a tax system that encourages large companies to take advantage of these retained earnings and create a flow of investment.

For this reason, the Ministry of Economy, Trade and Industry will deduct a tax if a large company invests more than a certain amount in a venture company where growth can be expected, in order to promote `` open innovation '' where multiple companies gather technologies and ideas. We are looking for the establishment of a system. It is expected that discussions will proceed based on this system at the tax examination committee.

However, regarding the system, the issue is how to determine the conditions of the target company and the size of the investment amount, and whether the system for deducting the tax amount for the investment of a financial company is an appropriate method, Some point out that it is unclear how far it will lead to the use of reservations.

On the other hand, as a financial resource for such tax incentives, half of the large company's expense expenses are recognized as expenses, and reduction of the tax burden system is being considered, etc. The ideal system should be discussed.

Focus on mitigation even if single parent is unmarried

Next year's tax reform will also focus on whether to apply income tax reduction measures to single parents who are not married.

Under certain conditions, a “widows deduction” is applied to single parents who have died or divorced from their spouse.

For this reason, the Komeito urged unmarried single parents to apply the same measures, and in the last year's discussion, it was decided that unmarried single parents with an annual income of 2.04 million yen or less would also be exempt from residence tax. It was.

However, income tax mitigation measures have not been realized, and the Komeito Party is calling for a new parent to apply to unmarried single parents in preparation for tax reform next year.

In this regard, the Liberal Democratic Party's chairman of the Amari Tax System said, “I want to secure the fairness of a single parent without destroying the basic view of the family,” suggesting a positive approach.

On the other hand, since there are strong opinions within the Liberal Democratic Party, such as “related to the way of the family”, it is expected that adjustments will be made between the Liberal Democratic Party and the Komeito Party in the future.

Examination of new taxation rules such as giant IT companies

The tax reform next year will also focus on discussions on new tax rules for large IT companies.

The international framework created in 135 countries and regions around the world for taxation on giant IT companies that make profits by cross-border data exchange aims to compile new tax rules in the next year.

It is being considered that a certain percentage of corporate profits can be taxed according to the sales volume of each country, so that the tax reforms will prevent Japanese companies from becoming disadvantaged. The policy is to incorporate the recommendations into

Review of “Corporate Tax Zero” for large profits

In addition, for multinational companies, there are cases where companies that are making large profits actually record a deficit for tax purposes using stock transactions with subsidiaries and do not pay corporate tax. We will review the system to prevent the act of avoiding and to make tax payments that match the actual situation.

Power gas corporation business tax review or discussion

On the other hand, the corporation business tax paid to the local government by the electric power company and gas company is taxed according to the sales unlike the general business operators because it is `` an oligopoly presence in the region '', etc. It will be discussed whether to review the current taxation method in response to liberalization.

The local government insists on maintaining the system because it will lead to a significant decrease in revenue if a review is made, and the judgment of the tax examination committee will be the focus.

Considering preferential treatment for 5G maintenance promotion

In addition, in order to promote the introduction of the next generation communication standard, 5G, measures to preferentially pay corporate tax for companies that will advance the development of communication networks such as base stations will be considered.

In the case of preferential treatment, the base stations to be developed are expected to discuss taking into account security risks with Chinese products in mind.

Considering asset building for retirement

In the tax reform next year, a tax system will be considered to boost asset formation after retirement.

The Ministry of Health, Labor and Welfare has decided to promote the use of “individual” defined contribution pensions = “iDeCo”, one of private pensions that individuals voluntarily join on public pensions. Indicates a revised bill that relaxes the conditions.

Specifically, a company employee who is participating in a “corporate” defined contribution pension contributed by an employer can join iDeCo without an agreement between labor and management if he / she wishes, A company called “iDeCo +” that allows companies to add premiums to employees who are members of iDeCo in small and medium-sized enterprises that do not have a corporate pension. And so on.

The amendment also includes an increase in the number of people in their 60s who work to help them build their assets after retirement.

Specifically, in principle, the upper limit of the membership period until the age of 60 has been extended to under 70 for “Corporate” and under 65 for “Individual”.

In line with this, we are also expanding the options for the age at which people can start receiving from the age of 60 to 70 years old.

The tax investigation committee will discuss whether the revised proposal is acceptable, and how the tax benefits that subscribers can receive at the time of benefits are discussed.

Tsutani NISA

Of the tax incentives for individual investors, “Tsutumite NISA” for long-term asset management, regardless of when it started, has a reserve deadline of up to the end of 2037 so that a 20-year investment period can be secured. Consider extension.

Extension of corporate hometown tax payment system

Regarding the vitalization of local areas, if a company contributes to local government initiatives that lead to regional revitalization, the “Corporate Furusato Tax Payment System”, which reduces corporate inhabitant tax and corporate business tax, is a system that is full this year. After extending the deadline for five years, it is considered to increase the rate of reducing the tax burden.

There will also be discussions on mitigating the increase in the number of employers, which is a condition for the application of corporate tax and other preferential treatment for companies that reinforce or strengthen their bases in rural areas.