Japan carmakers warn on taxing buyers five times more than US

Automakers warned the Japan government’s plan to replace, rather than abolish, a tax on consumers buying cars will undermine justification for keeping domestic production in place to serve a shrinking market.

Japan’s ruling Liberal Democratic Party last month proposed a tiered levy from April 2017 in place of the current tax on auto purchases. The Japan Automobile Manufacturers Association had lobbied for the duty to be scrapped, since consumers already pay a national sales tax when buying a vehicle.

“We can’t take it any more,” Fumihiko Ike, chairman of the association, told reporters at a Dec. 22 briefing in Tokyo. “Taxes are too high and if this continues, it will be hard for the auto industry to play a leading role in Japan’s economy.”

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