Achieving Fiscal Consolidation while Promoting Social Cohesion in Japan [electronic resource] / Randall S. Jones and Kohei Fukawa

By:

Jones, Randall S

Contributor(s):

Fukawa, Kohei

Material type: Article

ArticleSeries: OECD Economics Department Working Papers ; no.1262.Publication details: Paris : OECD Publishing, 2015.Description: 40 p. ; 21 x 29.7cmSubject(s):

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Abstract: With gross government debt of 226% of GDP, Japan's fiscal situation is in uncharted territory and puts the economy at risk. Japan needs a detailed and credible fiscal consolidation plan, including specific revenue increases and measures to control spending to restore its fiscal sustainability. The major concern on the spending side are social spending pressures in the context of rapid population ageing, making reforms to contain such spending a priority. Much of the consolidation, though, will have to be on the revenue side, primarily through hikes in the consumption tax rate beyond the 10% now planned for 2017. Fiscal consolidation should be accompanied by measures to promote social cohesion through the tax and benefit system and by breaking down labour market dualism. In particular, an earned income tax credit is a priority to assist the working poor.

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Item type	Home library	Collection	Call number	Status	Date due	Barcode	Item holds
Working Paper	Biblioteca Digital	Colección OECD	OECD 5jrtpbs9fg0v-en (Browse shelf(Opens below))	Not For Loan

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With gross government debt of 226% of GDP, Japan's fiscal situation is in uncharted territory and puts the economy at risk. Japan needs a detailed and credible fiscal consolidation plan, including specific revenue increases and measures to control spending to restore its fiscal sustainability. The major concern on the spending side are social spending pressures in the context of rapid population ageing, making reforms to contain such spending a priority. Much of the consolidation, though, will have to be on the revenue side, primarily through hikes in the consumption tax rate beyond the 10% now planned for 2017. Fiscal consolidation should be accompanied by measures to promote social cohesion through the tax and benefit system and by breaking down labour market dualism. In particular, an earned income tax credit is a priority to assist the working poor.

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