Japanese companies want tax, yen and commodity aid: Reuters survey Reuters

Author: Tetsushi Kajimoto

TOKYO (Reuters) – The vast majority of Japanese companies want tax relief to continue at least this year, a Reuters poll showed that two-thirds want to help ease the rise in commodity prices and the weaker yen.

The results of the Reuters Corporate Survey show that companies in the world’s third-largest economy feel the need for more support, even as major economies from Europe to the United States push back on crisis recovery programs.

The survey also highlights how the weak yen and rising commodity costs are being squeezed by the slow growth of the Japanese company and the aging of the internal population.

“Excessive weakening of the yen will increase import costs and further raise commodity prices,” the manager of a pottery producer wrote in a survey, contributing on condition of anonymity.

Others called for measures to counter the rise in the price of oil and prevent a weaker yen, as the rapid rise in prices more than offset the effects of the stimulus packages that have unfolded over the past two years.

Nearly 80% of Japanese companies said they had to follow a widespread fiscal policy, according to the survey. Monthly survey, December 22nd to January 22nd. 7, examined 502 large and medium-sized non-financial corporations.

A total of 61% said the stimulus should continue this year and another 18% said they wanted to implement it by 2023 or later. 17% said it should end immediately.

Although Japan fared much better than most other advanced countries in COVID-19 infections and deaths, avoiding weakening blockades, on Sunday the government imposed stricter measures in all three regions as a result of the expansion it took for the first time since September. Omicron variant.

“Fiscal discipline is important, but economic recovery and the stability of people’s livelihoods should be a priority,” one wholesaler wrote in the survey.

Another manager, from a different pottery manufacturer, wrote that fiscal policy should be expansive until the business revives the business of non-manufacturers, showing a clear tendency to revitalize.

Many companies supported the position of Prime Minister Fumio Kishida, which prioritizes economic recovery in the short term.

As a result, a large majority of companies found it “impossible” for the government to achieve the surplus of Kishida’s first budget for the 2025 fiscal year.

Most private sector economists see it as a big goal, given the high stimulus cost that has weighed on the world’s largest debt burden, more than double the size of its economy.

Japan’s deteriorating fiscal stance could eventually raise concerns about currency valuation and runaway inflation.

But for now, inflation forecasts were evenly distributed in the survey: one-third of firms saw current commodity-driven inflation during the first or second quarter, and another third expected it to last in the second half.

The rest continued to raise prices the following year or so.

($ 1 = $ 115,3000)