INTERVIEW: New Keidanren Chief Calls for No Delay in Consumption Tax Hike

May 31, 2018

Tokyo- Japan needs to raise its 8 pct consumption tax to 10 pct in October 2019 as planned, Hiroaki Nakanishi, new chairman of the Japan Business Federation, or Keidanren, said in a recent interview.

"A postponement (of the tax increase) to keep economic growth in place or alleviate the impact is not an option," said Nakanishi, set to assume the top post of the nation's biggest business lobby, on Thursday.

Even 10 pct is lower than in European nations and elsewhere, said Nakanishi, chairman of Hitachi Ltd. <6501>. Keidanren considers a consumption tax rate of over 10 pct as a workable option.

Nakanishi said he will strengthen Keidanren's push for growth and structural reform in the Japanese economy.

"Japan has many growth opportunities if it uses digital technologies well as social infrastructure," he said.

Nakanishi said the business community and the government need to work together to achieve Society 5.0 in which people optimize cutting-edge technologies, saying they should "share goals as much as possible."

He said it is necessary for Keidanren to build a relationship with the government that allows the two side to exchange opinions frankly if their views are in conflict.

"I don't think Keidanren's role is to oppose and make harsh comments," Nakanishi said of the business group's approach to the government.

When his predecessor, Sadayuki Sakakibara, was at the helm, Keidanren was criticized over its close relationship with Prime Minister Shinzo Abe's administration.

Nakanishi stressed that nuclear power will remain necessary in the future, saying, "I strongly believe that technologies that use nuclear power are very important for mankind." Hitachi is a major provider of nuclear equipment and service. Jiji Press