[60th note money publication] Chapter 100: Consumption Tax - She Knew Everything -

Chapter 100: Consumption Tax - She Knew -

[She knew everything.]

[A confession from the system side and a 14-year-long answer verification]

From this point on, this is no longer just a discussion.
It is a record of an [incident] where those operating the system themselves admitted in the public forum of the Diet that [in a liberal economy, prices are not cleanly passed on].
Satsuki Katayama left behind a question, which Yutaka Ando took over, and I want you to see the moment it finally led to a [conclusion].

- The soba shop that cannot raise 630 yen to 660 yen, and the 'relief' called the 30% special measure -

When I turned off the room lights, only the monitor on the desk stood out in white.

On the screen, Minister of Finance Satsuki Katayama is answering questions.

Changing the 20% special measure of the invoice system to a 30% special measure.

Changing the 80% deduction allowed for purchases from tax-exempt businesses to a 70% deduction.

Listening to requests from small businesses and commercial organizations, the burden will be 'gradually smoothed out'.

This is said to be a 'transitional measure for the smooth introduction of the invoice system'.

Mio stopped the video there.

Mio:
"Aoi. Who is this providing relief to?"

Aoi:
"The payment ratio for sole proprietors will rise from 20% to 30%. The deduction ratio for taxable businesses purchasing from tax-exempt businesses will fall from 80% to 70%."

Mio:
"Both of them are seeing their burdens increase, aren't they?"

Aoi:
"Yes. In the schedule created by the administration, this is a measure to 'smooth out' the burden."

On the screen, the paused Minister Katayama was smiling.

--Does she not know?

That small shops cannot pass on tax burdens to prices.

No.

She knew.

Value-added does not increase. The tax burden increases.

First, let's look at the average model of tax-exempt businesses presented by the Ministry of Finance in the Diet.

• Taxable sales: approximately 5.5 million yen

• Value-added rate: approximately 28%

• Value-added: approximately 1.54 million yen

The value-added referred to here is the portion newly created by the business, calculated by subtracting purchases from the previous stage from sales.

For a small-scale sole proprietor working alone, this amount must support their living expenses, social insurance premiums, taxes, and savings for the future.

The sales tax amount corresponding to 5.5 million yen in tax-inclusive sales is 500,000 yen.

With the 20% special provision,

With the 30% special provision,

The amount of work has not increased.

Sales have not increased either.

The value-added created remains at 1.54 million yen.

The only thing that has increased is the tax amount to be paid.

Under the 20% special provision, 100,000 yen is taken from the 1.54 million yen in value-added.

Under the 30% special provision, 150,000 yen is taken.

The remaining living funds will decrease from 1.44 million yen to 1.39 million yen.

Moreover, from that amount, I must pay national pension, national health insurance, resident tax, home rent, food expenses, and utility bills.

Mio:
The problem isn't whether I can pay.

Aoi:
It's whether you can survive after paying.

What was the tax-exempt threshold for?

In Japan, there is a system that exempts small-scale businesses with taxable sales of 10 million yen or less in the base period from the obligation to pay consumption tax.

This is the so-called tax-exempt threshold.

In a 2019 Diet response, the Ministry of Finance explained the purpose of this system as follows.

The tax-exempt threshold was not established to create 'people who can pocket consumption tax'.

It was established to exclude them from the tax net, considering the severity of imposing tax payment and filing burdens on small-scale businesses, as well as their administrative capacity and tax collection costs.

The invoice system left that tax-exempt threshold in the statutes.

However, it reduces the purchase tax credit for buyers who transact with tax-exempt businesses to 80%, 70%, 50%, 30%, and then zero.

If you do not register, the tax burden on your business partners will increase.

As a result, tax-exempt businesses are pressured to either register, lower their prices, or lose their business.

Mio:
So even though you can choose to be tax-exempt, if you remain tax-exempt, your business partners get hurt?

Aoi:
Yes. The system doesn't directly order registration, but it's structured so that business partners force you to register.

The 500,000 yen in sales tax is not simply 'tax gain'.

Here, let's consider a common explanation.

If a tax-exempt business has sales of 5.5 million yen including tax, the consumption tax equivalent within that amount is 500,000 yen.

A tax-exempt business does not pay that 500,000 yen in taxes.

Therefore, 500,000 yen remains in their hands--.

Is that really the case?

The Ministry of Finance model's value-added rate is 28%.

If we simplify by assuming the entire amount is taxable purchases at the standard tax rate, the purchase rate is 72%.

The consumption tax equivalent included in this purchase price is,

A tax-exempt business actually bears 360,000 yen at the time of purchase.

They cannot receive input tax credits or refunds.

Therefore, looking only at the 500,000 yen shown in sales, it cannot be called a 'tax gain'.

What must be recovered first is the 360,000 yen embedded in the purchase price.

Let us define the 'price pass-through rate' as the percentage of the 500,000 yen sales tax equivalent that was actually passed on as a price increase due to the tax burden.

In this case, the condition for a surplus like a tax gain to arise is,

Therefore,

is the result.

Only by passing on 72% can you finally recover the burden from the purchase stage.

Only after exceeding 72% does the possibility arise that a 'surplus like tax-gain' will occur on the excess portion.

Moreover, the fact that a selling price of 5.5 million yen including tax is established is not proof that 500,000 yen was successfully passed on in the price.

How much was the price actually raised due to the tax burden compared to if there were no consumption tax?

That is written neither on the invoice nor on the receipt.

Mio: "Even though you are bearing 360,000 yen in purchases, were you treating the entire 500,000 yen written in sales as pocketed money?"

Aoi: "Yes. And I haven't even confirmed whether that 500,000 yen was truly added to the price."

Mio: "So a price pass-on rate of 72% or more is finally the entrance to 'something like tax-gain'."

"In this simple model, that is the case."

Mio: "There's no way a small shop could pass on that much."

2012 - A local soba noodle shop

Aoi opened another video.

What appeared on the screen was Diet member Satsuki Katayama on March 16, 2012.

At the time, as an opposition member, she was questioning the impact that raising the consumption tax rate would have on small and medium-sized enterprises.

Diet member Katayama used a local soba shop as an example.

For a large chain with uniform prices nationwide, it might be easier to raise prices.

But what about a regular local barbershop?

What about a small shop supported by local customers that might lose them by raising prices?

Diet member Katayama continued.

There is a survey showing that 50% to 70% of small and medium-sized enterprises with annual sales of 30 million yen or less are unable to pass on price increases.

And 340 billion yen, which is half of the tax arrears, is consumption tax—.

Mio remained motionless, staring at the screen.

Mio:
"You knew, didn't you?"

Aoi:
"Yes."

Mio:
"Small shops can't raise prices. The consumption tax that couldn't be passed on remains inside the shop. You knew that!"

Tax that remains inside the shop

If you can't raise 630 yen to 660 yen, the increased tax burden is not shifted to the consumer.

It remains inside the business.

It cuts into the shop owner's income.

It cuts into employee wages.

It cuts into funds for tomorrow's inventory.

It cuts into savings for equipment upgrades.

If that's still not enough, they dip into their savings.

They take out loans to pay the tax.

If they still can't pay, it becomes tax arrears.

Consumption tax is not always passed on to the consumer.

Representative Katayama knew that.

Therefore, this is not merely a past statement.

It is testimony from the person himself to help decipher the "transitional measures" explained by the current Minister of Finance, Katayama.

Even on the front lines, price shifting was not being achieved.

More than ten years have passed since 2012.

So, has it become possible to pass on costs in the field after the introduction of the invoice system?

The 2025 "Survey on the Actual Conditions of 10,000 Invoices" reports the following results regarding invoice-registered businesses.

• About 80% have been unable to pass on the new consumption tax burden or administrative costs to prices

• Less than 5% of businesses were able to pass on the full amount to prices

• Over 40% paid by reducing their income or savings

• Over 10% paid by taking on debt

This survey is a voluntary response survey conducted by an anti-invoice group, and 97.3% of respondents oppose the system.

Therefore, that percentage cannot be treated as the national average as is.

However, as data showing the reality on the ground of "where those who could not pass on costs got the funds for tax payments," it carries weight.

Even in the 2025 survey by the Japan and Tokyo Chambers of Commerce and Industry, which targeted a relatively broad range of small and medium-sized enterprises, only 23.2% of businesses negotiated prices following the transition to the taxable status.

Of those, the rate of achieving a price increase was 76.9%.

If we simply calculate the percentage of "businesses that negotiated on their own and achieved a price increase" relative to the total,

At the very least, those for whom a price increase through their own negotiations can be confirmed account for about 18% of the total.

I would like to note something here.

The 72% mentioned earlier is the cost-based pass-on rate required for a single business to recover the equivalent of the purchase tax credit.

17.8% is the percentage of businesses for which it can be confirmed that they negotiated on their own and achieved a price increase.

The two are not the same figure.

However, the direction indicated by the two surveys is the same.

Mio:
"Before even talking about whether 72% can be passed on, aren't the majority of people unable to even enter price negotiations?"

Aoi:
"Yeah. Even so, the system is explained on the premise that it will ultimately be passed on to the consumer."

Mio:
"What about the tax that couldn't be passed on?"

Aoi:
"It is paid from income, savings, and loans."

Mio:
"Where did the 'deposit-like' nature of the tax go?"

Aoi:
"It's missing in action again."

2026—'Smoothing out' the burden

Mio returned to the video at the beginning.

Finance Minister Katayama in 2026 acknowledged that there were voices from the field and small business organizations asking for consideration regarding the burden.

On that basis, he moved from the 20% special provision to the 30% special provision.

From an 80% deduction to a 70% deduction.

He explained that these were transitional measures to 'gradually, gradually smooth it out.'

In 2012, lawmaker Katayama knew that there were shops that could not raise the price of a 630-yen bowl of soba to 660 yen.

He had presented surveys showing that 50% to 70% of small business owners could not pass on price increases.

He had also pointed out that tax arrears for consumption tax were reaching massive amounts.

It wasn't that he didn't know.

He knew that the tax burden that could not be passed on would erode the business owners from the inside.

That same person is now calling the burden increasing from 20% to 30% a 'transitional measure for smooth implementation.'

Mio:
"If he didn't know, that would just be a lack of awareness."

Aoi:
"Because she knew, it becomes a matter of semantics."

Mio:
"She wrapped the tax increase schedule for shops that can't raise prices in words that make it look like 'relief'."

Aoi:
"It's not relief to stop the system, but a transitional measure to ensure the system is completed smoothly."

On the screen, the 30% special provision and 70% deduction were explained as considerations for small-scale businesses.

However, if you set the baseline before the system was introduced, the burden has increased.

While calling the burden being lighter than the full version 'relief', that relief is gradually being reduced toward the completion of the system.

She knew.

Mio was walking through the town at dusk.

A small soba noodle shop.

An old barbershop.

A flower shop run by a married couple.

A coffee shop run by one person.

The price tags in front of the shops have hardly changed for a long time.

Material costs have gone up.

Electricity bills have also gone up.

Social insurance premiums have also gone up.

Even so, the shop owners cannot rewrite the price tags for fear of losing customers.

In 2012, Representative Katayama was looking at shops in such towns.

That is precisely why he asked.

Can you make a 630 yen soba noodle dish cost 660 yen?

That was no mere question.

It was an answer presented in the form of a question by someone who understood the consumption tax system and the reality of the market.

There are shops that cannot.

There are business operators who cannot pass it on.

The tax that could not be passed on eats away at the inside of the shop.

She knew.

In the back of the shop, a customer who had finished paying held up their card.

Beep.

That sound is not the sound of tax collected from a consumer flowing cleanly to the government.

It might be the sound of the burden that could not be passed on to the price slipping out of the shop owner's income.

It might be the sound of funds for tomorrow's inventory shrinking.

It might be the sound of the time left to keep the shop running growing a little shorter.

Mio stared at the lit-up shop.

Beep.

That sound was, again today, the sound of someone's business being whittled away.

Reference Materials

• 180th National Diet, House of Councillors Budget Committee, No. 10 (March 16, 2012)

• 198th National Diet, House of Representatives Committee on Financial Affairs, No. 3 (February 26, 2019)

• 221st National Diet, House of Councillors Committee on Financial Affairs, No. 2 (March 24, 2026)

• National Tax Agency 'FY2026 Tax Reform Special'

• Japan/Tokyo Chamber of Commerce and Industry: "Survey on the Invoice System, etc. for Small and Medium-sized Enterprises"

• STOP! Invoice: "2025 Survey on the Actual Status of 10,000 Invoices"

"The management is cheating."

SSR [Apparition 017 | Official Cheat]

Rarity: SSR
Attribute: System/Darkness/Management
Race: System-Implemented Apparition
Danger Level: ★★★★★★★★★★★★★★★
Unique Ability:
<<Rule Alteration>>
<<Deduction Chain Severance>>
<<Tax Base Expansion>>
<<Internalization of Reporting Destination>>

Flavor Text

When the officials who are supposed to protect the system rewrite the rules themselves,
the apparition reaches its final form.

The tax rate does not rise. However, what can be deducted decreases.

As a result, the tax base expands, and the burden on businesses quietly multiplies.

Moreover, the officials call this "optimization."

Effect Description

When this card enters the field,
it partially invalidates "deductions" on the opponent's field.
The invalidated deductions
are added directly to the tax base.
Furthermore, as long as this card exists,
the opponent will find it difficult to perceive this effect as a "tax increase."

True Name

An apparition where the officials rewrote the rules and implemented specifications that only they can win with.

Weakness

Visualization of the structure
Formulating the tax base
The question of 'what can no longer be deducted'

The reporting destination is the management.

Who determines that this system is unfair?
Who corrects the cumulative taxation caused by the severance of deductions?
Who overturns the explanation that 'this is not a tax increase'?
The ones who made the rules are the management.
The ones who receive the tax revenue are the management.
The ones who explain the system are the management.
The ones who receive complaints are the management.
And the final arbiter is also the management.
Mio:
'Where is the reporting window?'

Aoi:
'It's the management.'

Mio:
'Who is the arbiter?'

Aoi:
'The management.'

Mio:
'Who receives the tax revenue?'

Aoi:
'The management.'

Mio fell silent for a while. Then, she asked timidly.


Mio:
'What is the final answer?'
Aoi read the text displayed on the screen.

It is a specification.

That was the final verdict in a world where the management cheats.

Mio: 'Aoi. What should we do from now on?'

Aoi: 'We must know.'

Mio:
"What if they don't know?"
Aoi looked toward the city for a brief moment.

Aoi:
"It's the same as it has always been."

Without them knowing, bills pass through the Diet.
Without them noticing, systems are created.
Livelihoods are whittled away.
Businesses are whittled away.
Even then, they don't know what is happening.
Because they don't know, they cannot raise questions.
Because they cannot raise questions, they cannot oppose it, nor can they change it.
And even if they realize they are being whittled away—
they have no words to explain it.
Aoi said briefly.

"If they don't know, they won't even realize they've been robbed."

Mio watched the city in silence. At some shop, a register beeped.

Beep.
Once again today, a tax assessment is placed on someone's sales.
Someone's deduction is cut.
Someone's profit is whittled away.
But if they don't know the mechanism, it just sounds like the noise of shopping.The sound rang out once more.

Beep.That sound was—

It was the sound of someone being whittled away again today.

[14 Years Later: Checking the Answers] Hiroshi Ando takes over the question left behind by Satsuki Katayama

Reference Video:

[She knew everything.]

[Confessions from the system side, and checking the answers 14 years later]

From here on, I will intentionally repeat myself.
Because this is not merely a Diet interpellation.
The "smooth and appropriate price pass-through" that the consumption tax system has assumed, and what is actually happening in the real market.
This is a record of an "incident" where those two things collided head-on in the public arena of the Diet.
In a liberal economy, prices do not move as the system intends.
Just because costs have risen does not mean the full amount can be passed on to the price.
Just because the consumption tax rate has risen does not mean the selling price can be raised by that amount.
Even if the price cannot be passed on, the burden of the consumption tax does not disappear.
It shifts to the business operator's profits, wages, bonuses, investments, and cash flow.

At that moment, the issue of consumption tax changes from a problem of "price pass-through" to a problem of who is forced to bear the tax cost.

2012.
A politician pointed out its dangers in the National Diet.
It was lawmaker Satsuki Katayama.
And 14 years later.
Yutaka Ando took over the question left behind by Satsuki Katayama.
Sitting on the side receiving the question was Satsuki Katayama, who had become the Minister of Finance.
This is also a record of how someone who criticized the system from the outside changes their words when they reach the pinnacle of that system.

In 2012, she knew everything

"It will become something uncontrollable."
2012.
During her time in the opposition party, lawmaker Satsuki Katayama strongly warned about the impact that a consumption tax hike would have on the economy.
Housing.
Local economies.
Small and medium-sized enterprises.
The local soba shop.
The ordinary barbershop.
Small business owners who cannot raise prices even if they want to.

Lawmaker Katayama pointed out with concrete examples that the consumption tax does not end as a mere "burden on the consumer."

For example, the local soba shop.

This is not just a question.

It is an answer presented in the form of a question by someone who knows the consumption tax system and the reality of the market.

Large chains with uniform prices nationwide might find it easier to raise prices.
But what about small shops supported by local customers?
What about the local soba shop?
What about the ordinary barbershop?
Can one easily say to a shop that risks losing customers by raising prices, "Since the tax rate has gone up, you should just pass that on to the price"?

At the time, lawmaker Katayama stated that there was a survey showing that 50 to 70 percent of small and medium-sized enterprises with annual sales of 30 million yen or less were unable to pass on the costs.

Furthermore, she pointed out that 340 billion yen, which is about half of the total tax arrears, is consumption tax.

In other words, she knew.

The consumption tax is explained as being "intended to be passed on to the price."

However, in the real market, the weaker the business, the less they can pass it on as intended.

The consumption tax was a tax that could not function unless the system's intentions and the market's reality matched.
Satsuki Katayama in 2012 knew that contradiction.

14 years later, the question returns

14 years later.
This time, Yutaka Ando, who returned to national politics as a Diet member for the Sanseito party, began to ask the same question in the Diet.

Sitting in the answer seat was Satsuki Katayama, who had become the Minister of Finance.

The first thing Representative Ando confirmed was who is liable for paying consumption tax.
Legally, who bears the obligation to pay consumption tax?
Is it the consumer?
Is it the business operator?
The answer was clear.
Under the Consumption Tax Act, the person liable for tax payment is the business operator.
The government explains that consumption tax is intended to be ultimately borne by the consumer through price pass-through.
However, that is an expectation regarding the economic burden.
It is a different matter from the tax liability under tax law.
Under tax law, the consumer is not the person liable for consumption tax payment.
It is the business operator who files and pays the consumption tax.
At this point, Representative Ando pushed the questioning further.
Does the so-called 'tax gain'—where it is claimed that business operators keep the consumption tax received from consumers as their own profit instead of paying it to the tax office—exist under the system?
To this, Finance Minister Katayama replied that legally, such a relationship does not exist.
Consumers are not the persons liable for tax payment under the Consumption Tax Act.
Therefore, there is no legal structure where business operators hold tax money that consumers should pay and keep it as profit without paying it to the state.
Legally, tax gain does not exist.
Here, the story of consumption tax that has been told for many years begins to waver.

The illusion of complete pass-through

Many people understand consumption tax as follows:
First, there is the cost.
A reasonable profit is added to that.
Then, a 10% consumption tax is added on top of that.
The consumer pays that 10%, the business operator holds it temporarily, and pays it to the tax office later.
In this model, the business operator's profit is not reduced by the consumption tax.
Labor costs are not reduced either.
This is because the consumption tax is completely added to the outside of the selling price and is borne entirely by the final consumer.
However, for this model to hold, strong premises are required.
That all business operators can completely add the consumption tax equivalent to the price after securing the cost and necessary profit.
In other words, a market with a 100% price pass-through rate.
If all transactions were truly conducted this way, there would be almost no loss-making companies.
There would be no low-wage workers.
There would be no price squeezing.
Since they can add the consumption tax portion to the price after securing profit, there should be no business operators who cannot pay consumption tax and end up in financial distress.
But reality is different.
There are loss-making companies.
There are low-wage workers.
There is price squeezing.
There are business operators with weak price negotiation power.
There are shops that would lose customers if they raised prices.
There are business operators who cannot sufficiently pass on costs to selling prices even if raw material costs rise.

The beautiful model of 'cost + reasonable profit + consumption tax' does not represent the real market.

It is an expectation set in place to make the system work.

Why consumption tax occurs even when in the red

The amount of consumption tax payment is roughly calculated by the following formula:

Consumption tax
＝
Tax amount on sales - Tax amount on purchases

In a simple model with a standard tax rate of 10% and all amounts including tax, it can be expressed as follows:

Consumption tax
≒
(Taxable sales - Taxable purchases) × 10/110

What is important here is that, unlike corporate tax, profit is not calculated by subtracting all expenses from sales.
Even if they are necessary business expenditures such as salaries, social insurance premiums, or interest payments, some are not eligible for tax credit on purchases.
Therefore, even if the profit for corporate tax purposes is in the red,

Taxable Sales − Taxable Purchases > 0

then consumption tax will be incurred.
Whether a business is in the red or the black does not stop the calculation of consumption tax.
This is because consumption tax looks at the difference between taxable sales and taxable purchases, not profit.
Generally, businesses add some kind of value to the products they purchase before selling them.
A business that continues to sell products purchased for 100 yen for 50 yen every time cannot survive.
A manufacturing industry that continues to use 100 yen worth of raw materials and sell products for 50 yen cannot survive either.
Therefore, as long as the business is continuing, generally,

Taxable Sales − Taxable Purchases > 0

will be the result.
Even if the company as a whole is in the red, this difference can remain.

Therefore, consumption tax is incurred even for businesses in the red.

It is not that "consumption tax may be incurred" even when in the red.
As long as the business is generating added value, the structure is such that consumption tax is incurred even if it is in the red.

Pre-emption of Added Value

Taxable sales minus taxable purchases generally corresponds to the added value newly created by that business.

To simplify,

Added Value
≒
Taxable Sales − Taxable Purchases

Furthermore, that added value can generally be perceived as,

Added Value
≒
Profit + Personnel Expenses

Therefore, the structure of consumption tax can generally be expressed by the following formula.

Consumption Tax ≒ Added Value × 10/110

To simplify further,

Consumption Tax ≒ (Profit + Personnel Expenses) × 10/110

is the result.
What is happening here?

There is a single pie called the added value created by the business.

Originally, that added value is distributed to workers' wages and the company's profits, etc.
However, in a world with consumption tax, the government's share is determined before that distribution.

The government takes the consumption tax first.

The remaining value-added is split between the corporation and the workers.
If it can be fully passed on to the price, the burden might be pushed outside the business operator.

However, if the price cannot be passed on, the consumption tax remains within the value-added.

It cuts into profits.
It cuts into the source of funds for wage increases.
It cuts into bonuses.
It suppresses hiring.
It delays capital investment.
It puts pressure on cash flow.
The tax burden does not disappear.
It only changes where the burden is borne.

The words of Diet member Ando, 'We are told to pay the consumption tax before we can take the funds for wage increases,' represent this structure.

Consumption tax is a tax where the government secures its share first from the single wallet of value-added.

The remainder is then split between the corporation and the workers.
This is the 'pre-emption of value-added.'

The 'Consumption Tax Included' on the receipt

Diet member Ando also delved into the display on receipts.
For example, suppose you buy a product for 1,100 yen.
The receipt says,
'Consumption tax included 100 yen'
So, what is this 100 yen legally?
The government's response was as follows:
It is an amount equivalent to the consumption tax that should be imposed on that transaction, and it is part of the consideration for the transfer of taxable assets, etc.

In other words, even if 'consumption tax' is written on the receipt, it is not the tax itself that the consumer paid to the tax office.
It is not the tax itself that the business operator held on behalf of the consumer.
It is not the amount that the business operator pays directly to the tax office.

It is merely a record of the fact that the transaction was concluded at that price and a breakdown of that tax-inclusive price.

From the receipt display, you cannot tell how much of the price was actually passed on.
You cannot tell how much the business operator will pay.
You cannot tell how much profit the business operator has left from that transaction.

Even so, many people recognize that they have paid 100 yen in tax by seeing the 'Consumption tax included 100 yen' display.

And they think that the business operator is just holding onto that 100 yen.

From this, the story of 'tax profit' arises, claiming that 'tax-exempt businesses that do not pay the tax they held are cunning.'

However, the legal structure is different.
The consumer is not the taxpayer.
The 100 yen written on the receipt is part of the consideration for the sale.
The amount paid by the business operator is determined by the difference between the sales tax and the purchase tax, not by the amount displayed on the receipt.
The receipt is not proof that the price was successfully passed on.
It is not proof that a deposit exists.
What is recorded there is,

'A single transaction was concluded at that price'

is the fact.

Words from 2012 and words from 2026

In 2012, Diet member Satsuki Katayama spoke about the reality of the market.
Can the local soba shop raise its price from 630 yen to 660 yen?
Are small and medium-sized enterprises really able to pass the consumption tax on to the price?
What does the consumption tax bring to business operators who cannot raise prices?
She was looking at what was happening on the ground, not the intended design of the system.
Fourteen years later.
Satsuki Katayama, now Minister of Finance, speaks the words of those who defend the system.
The consumption tax is intended to be ultimately borne by the consumer through the passing on of the price.
The consumption tax equivalent amount is appropriately passed on to the price.

Two sets of words exist within the same person.

Words that see the reality of the market.
Words that uphold the plans of the system.
Why did Satsuki Katayama change her words?
Perhaps her way of thinking really did change.
Perhaps as Finance Minister, she must protect the tax system as a whole.
Perhaps the dynamics within the party or her relationship with the Ministry of Finance had an influence.

Or perhaps her fundamental understanding remains unchanged, and only the words she uses have changed depending on her position.

The answer to that is known only to her.
But one thing is certain.

The problem pointed out in 2012 remains unsolved 14 years later.

There are businesses that cannot pass on costs.
Consumption tax is incurred even when there is a deficit.
Arrears in consumption tax continue.
While saying that wage increases are necessary, the structure of taking consumption tax from the source of wage increases first is maintained.

And even now, the government explains consumption tax as a "stable source of revenue that is not easily affected by the economy."

But the fact that it is not easily affected by the economy means, in reverse, that they will continue to take it even when the economy is bad.

Even if people's lives are difficult.
Even if corporate management is difficult.
Even if there is a deficit.
Even if cash flow is at its limit.
As long as value-added remains, consumption tax is incurred.

Can we really call that "stable"?

This is a record of the incident

14 years ago, Satsuki Katayama left a question behind.
And now, Hiroshi Ando has taken over that question.
Sitting on the side receiving the question was Satsuki Katayama, who had become Finance Minister.
The Satsuki Katayama of 2012 spoke of the reality of the market.
The Finance Minister Katayama of 2026 spoke of the plans of the system.
What changed was not the market.

It was the chair she sat in.

If you look at the market from outside the system, you can see businesses that cannot pass on costs.
If you look at the tax system from the top of the system, the explanation becomes that it is "planned to be passed on smoothly and appropriately."
The facts have not changed.
The words used changed depending on the position of observation.

Those who sit at the top of the monstrosity that is the system are redefined as parts to protect its structure.

The more correct her words from 14 years ago were, the more the current response serves as proof that this country's politics chose the maintenance of the system over the reality of the market.

This is not a story that blames the change of heart of Satsuki Katayama alone.

If anyone who sits in that chair is forced to say the same words, then the problem lies in the structure, not the individual.
Therefore, she is not the only one who must face the question.

It is us ourselves, who accept that change of heart as a "specification" of the system and continue to let the sound of the cash register pass us by today.

Who exactly brought about the lost 30 years?

This is not just a problem for businesses

Beyond the 30% special measure, not all businesses will face a tax increase.
However, businesses moving to Type 4, 5, or 6 simplified taxation, or those under standard taxation with an input tax deduction rate below 70%, will face a higher tax burden than under the 30% special measure.
According to the Ministry of Finance model, that burden moves like this.
100,000 yen.
150,000 yen.
And, depending on the industry,
200,000 yen. 250,000 yen. 300,000 yen.
If they can pass on the price, the burden on business partners and consumers increases.
If they cannot pass on the price, the business owner's income, savings, capital investment, and living expenses are cut.

No matter which way it goes, it is not newly created value-added.

Value-added does not increase.
Only the tax burden increases.

Businesses that can no longer bear that burden will eventually disappear from the market.

What disappears is not the 'tax-exempt business' on the ledger.
It is the shop in town.
It is the local artisan.
It is the person carrying the goods.
It is the writers, designers, engineers, photographers, cleaners, and outsourced staff who support corporate work from behind the scenes.
If suppliers disappear from the market, products, services, technology, and employment, as well as consumer choices, are lost.

This is not just a story about who pays the consumption tax.

It is a story about who is being erased from the Japanese market.

Mio looked at the street.
Beyond the noren curtain, the shopkeeper was operating the payment terminal.
Unable to raise the price of the 630 yen (tax included) soba to 660 yen.
Before long, a small electronic sound rang out.
Beep.
Mio:
'Will taxes be raised further once the relief ends?'
Aoi:
'The more a business generates value-added through their own labor, the more likely that is.'

Mio:
'That's not relief.'

'Aren't you just showing us the tax increase little by little!'

The 30% special measure is not the final destination.
Beyond that, the next stage for transitioning to normal taxation is waiting.

Many small-scale businesses still do not know this fact.

If there are any sole proprietors or people running small companies around you who have registered for the invoice system, please share this article with them.

Before deciding whether to support it or oppose it, I want you to first know how your own tax burden will change from here on.

The timer is already running.
Beep.

That sound was, again today, the sound of cutting into someone's livelihood and erasing someone's business from the market.

[Popular Articles]

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*Refer here for [63rd note Money Publication] Chapter 103: Consumption Tax - Supply Chain Collapse -

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*Refer here for [62nd note money publication] Chapter 102: Consumption Tax - Quiet Market Exclusion -

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* [52nd note money publication] Chapter 92: Consumption Tax - Grand Unified Theory, please refer here

<Pre-empting Value Added - The Two Katayamas>

* [Mio and Aoi] Chapter 91: Consumption Tax - Pre-empting Value Added - The Two Katayamas, please refer here

<The Calculation Formula Without Tax Gain - It Was Just a Tax Hike>

* [Mio and Aoi] Chapter 90: Consumption Tax - The Calculation Formula Without Tax Gain - It Was Just a Tax Hike, please refer here

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<<Popular Magazines>>

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[The Real Reason Japan Became Poor]

* Japan did not become poor due to a lack of effort. It is the result of a accumulation of systems that have cut household take-home pay and consumption, and thinned out corporate sales and investment. Consumption tax, social insurance premiums, austerity, PB surplus, invoices. This is a magazine that deciphers them as a single economic structure.

[Nurturing the Soil.]

* This series is a story that connects everything from home gardening to national land regeneration through the single perspective of [Nurturing the Soil]. Weeds, fallen leaves, water, organic matter, abandoned land, forestry, regions--. Using stories of familiar gardens as an entrance, I write about how soil supports people and regions in a way that can actually be used.

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