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ECONOMY > Economic Policy

MOF wants review of consumption tax revenue distribution rules

Tokyo, Oct. 31 (Jiji Press) — Japan’s Ministry of Finance proposed Tuesday the review of distribution rules on local consumption tax revenues, an important income source for prefectural governments.

The proposal was presented at a subcommittee meeting of the Fiscal System Council, an advisory panel to the finance minister.

Also in the proposal, the ministry opposed a plan by the administration of Prime Minister Shinzo Abe to realize free education for higher education without exception.

Currently, the central government collects revenues from the 8 pct consumption tax and allocates funds worth 1.7 percentage point of those revenues to prefectural governments.

As 75 pct of the amount to be distributed to prefectural governments are decided based on sales by local businesses, governments of prefectures having more businesses gain more funds.

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