September 11, 2009
Summary
◆On 30 August the Democratic Party of Japan won 308 seats in the House of Representatives, a landslide victory.
◆The DPJ's INDEX 2009 policy document says that the 10% tax rate on stocks will be maintained for the time being, but its expiration will depend on the "economic and financial situation." If economic and financial situation improves, the tax rate could be increased even earlier than 2011.
◆The DPJ's "INDEX 2009" policy document says that ultimately it would be preferable to include financial income in the tax on aggregate income, but for the time being, it intends to expand the scope of gain/loss aggregation on different financial incomes while taxing financial income separately. If it becomes clear that fiscal resources are insufficient to carry out the policies spelled out in the Manifesto, the new government could increase taxes on financial income as part of an overhaul of special taxation measures (interest, dividends and capital gains are subject to special taxation measures).
◆The direction that the new DPJ government will take on securities and financial tax policy will likely be heavily influenced by who is appointed to the relevant positions. The need to cooperate with the Social Democratic Party and other parties may also influence policy.
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