Japanese Prime Minister is expected to announce by the end of this year whether the nation will go ahead with a second rise to its consumption tax rate, to 10% from November 2015. As Japan’s economy contracted by 6.8% year-on-year during the second quarter of 2014, according to Government figures, with consumer consumption declining substantially follow the April 2014 hike to the consumption tax rate to 8%.
Some economic advisers to the Japanese Government now fear that the November 2015 sales tax hike may need to be deferred – until as late as 2017, one adviser said – to ensure that there is not a repeat of the deep recession of 1997. Japan is widely expected to push through with the hike however with stimulus measures lined up should the economy falter.
