Analysts Opinions On Japanese Sales Tax Mixed

Economists are split over how long Japan’s government has to rein in the world’s biggest debt burden, a Bloomberg News survey shows, adding to a debate on whether the government should keep ratcheting up a sales tax.

Eleven of 34 analysts said the government has four years or less to put fiscal policy on a sustainable path and avoid a crisis, while seven said it has over 10 years. BNP Paribas SA and Credit Suisse Group AG were among five saying it’s too late to avert one. UBS AG says chances of a fiscal crisis are remote.

The lack of consensus offers an opening to opponents of a 2 percentage point increase in the sales tax, due next year after a 3-point jump next month. At stake is ensuring an improvement in Japan’s finances to assure demand for public debt remains once the central bank, the biggest buyer of the securities, achieves its inflation target and tapers stimulus.


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Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu