Tax Break

Essential reading: Japan premier wins sales tax deal, and more

June 21, 2012

Welcome to the top tax and accounting headlines from Reuters and other sources. 

* Japan premier wins sales tax deal. George Nishiyama, Toko Sekiguchi and Alexander Martin – The Wall Street Journal. Japanese Prime Minister Yoshihiko Noda won the backing of the main opposition parties for a contentious bill to double the sales tax Thursday. But their support, which ensures the bill’s enactment, came at a high price—a possible ruling-party split led by the prime minister’s biggest rival. Noda’s ruling Democratic Party of Japan and the two main opposition parties agreed to enact the bill to raise the tax to 10 percent by 2015 in the current parliament session, which was extended to early September. The bill is seen as a long overdue first step in curbing the country’s massive debt, now more than twice the size of the economy. Link

* Soda taxes should be used to fight obesity: doctors. Julie Steenhuysen – Reuters. America’s largest physician organization recommended on Wednesday that taxes levied on sugar-sweetened sodas be used to fight the country’s growing obesity crisis. But the policy statement adopted by the American Medical Association’s House of Delegates meeting in Chicago fell short of outright support for taxing sugar-sweetened beverages to control use of these products. Link  

* Health-care tax credit eludes some. Emily Maltby – The Wall Street Journal. Hundreds of thousands of small businesses are excluded from claiming a health-care tax credit, and many blame overly narrow restrictions. Small-business advocacy organizations had projected that millions of employers would be eligible for the health-care tax credit when the health-care overhaul law passed in March 2010. But most businesses either didn’t offer insurance or otherwise fell outside the eligibility requirements. Link  

* Carr tax ‘morally wrong’, says PM. Jim Pickard and Vanessa Houlder – The Financial Times. David Cameron, The British prime minister, on Wednesday branded the tax arrangements of comedian Jimmy Carr “morally wrong” after press reports that he was one of a number of celebrities using elaborate schemes to avoid paying tax. The comments followed revelations that financial arrangements used by Carr and investments by members of the pop band Take That are being investigated by Revenue & Customs. Link  

* Indonesia army to train tax collectors. Ben Bland and Taufan Hidayat – The Financial Times. Indonesia’s tax office has come up with an unconventional response to pressure to raise the paltry tax take and shed its reputation for corruption in the form of a military boot camp for tax collectors. The tax office said on Wednesday that it would soon start sending its 32,000 tax officers for two to three weeks of training with the army in an attempt to boost morale and promote professionalism. Link 

* Chinese artist is barred from his own hearing. Andrew Jacobs – The New York Times. If the Chinese authorities thought that barring the artist Ai Weiwei from the courtroom where his lawsuit against tax officials is being heard might tamp down public interest in the matter, they must be sorely disappointed. On Wednesday, after the police told Ai that he could not attend the proceedings and blocked scores of other dissidents from leaving their homes in the capital, hundreds of supporters gathered outside the Chaoyang District Court here in Beijing despite a small army of police officers, some of whom videotaped the crowd and led several people away. Link 

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