News / Asia

Japan Proposes Selling Tobacco Stake to Fund Quake Recovery

Smokers in Japan flock to stock up on cigarettes, even by stealing them, or struggling to kick the habit ahead of a record tobacco price increase, (File).
Smokers in Japan flock to stock up on cigarettes, even by stealing them, or struggling to kick the habit ahead of a record tobacco price increase, (File).

The policy head of Japan’s ruling party has called on the government to sell its entire stake in Japan Tobacco to help fund the reconstruction of the region hit by the March 11th earthquake and tsunami.

The possible sale of the government’s 50 percent stake in Japan Tobacco - the world’s third-largest cigarette maker - is part of a series of measures to raise emergency funds for the disaster-hit region.

Television reports said the Democratic Party of Japan also agreed to draft another supplementary budget for the current fiscal year, worth about $157 billion, most of which will go towards post-disaster reconstruction.

The government hopes to raise as much as $120 billion through new tax increases. The tax increases are $26 billion  lower than originally expected, which the government hopes will win opposition support for the plan.

After two days of intense negotiations, senior DPJ officials agreed to temporarily increase income, corporate, residential and tobacco taxes in the next three to ten years. The money will be used to pay back new debt issued to generate revenue for the disaster reconstruction program.

The government is expected to spend $248 billion in the next five years to pay for reconstruction.

Japan’s public debt - now twice the size of its five trillion dollar economy - has forced the government to seek alternative sources of revenue.  The two-stage sale of its stake in Japan Tobacco and other entities is expected to raise about $90 billion. Some of that total will come from spending cuts.

This week, Seiji Maehara, the Democratic Party of Japan’s policy chief, surprised many people when he called for the government to offload all of its Japan Tobacco shares.

Maehara tells reporters the government is keen to put the funding measures in place as soon as possible. He says he hopes opposition parties will quickly accept the government’s sincere request to cooperate so that rebuilding can begin.

Shares in Japan Tobacco Incorporated rose by as much as nine percent on Thursday's news.

Despite the positive response from the market, the government still faces legal hurdles for the deal. The sell-off would require a change in the law, as the government already owns the minimum legal stake in Japan Tobacco. Tobacco farmers, who are traditionally close to the opposition Liberal Democratic Party, may oppose the move because of concerns that a fully privatized Japan Tobacco will no longer buy their entire crop.

The cabinet is expected to submit a draft of the emergency budget and tax reform bills to parliament in October.

You May Like

Lesotho Faces New Round of Violence, Political Crisis

Brutal killing of military officer has sent former leaders back into S. Africa where they're watching anxiously as regional officials head in to try to restore peace More

Video US Diplomat Expects Adoption of Bosnian Massacre Anniversary Resolution

Samantha Power says there's broad consensus about killings in Bosnia's war, but Russia calls resolution 'divisive,' backs UN countermeasure More

America's Most Exotic Presidential Pets

From alligators to bears, the White House has been home to some unusual presidential pets over the years More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Olympics Construction Scars Sacred Korean Mountaini
X
July 02, 2015 4:10 AM
Environmentalists in South Korea are protesting a Winter Olympics construction project to build a ski slope through a 500-year-old protected forest. Brian Padden reports that although there is strong national support for hosting the 2018 Pyeongchang Winter Olympics, there are growing public concerns over the costs and possible ecological damage at the revered mountain.
Video

Video Olympics Construction Scars Sacred Korean Mountain

Environmentalists in South Korea are protesting a Winter Olympics construction project to build a ski slope through a 500-year-old protected forest. Brian Padden reports that although there is strong national support for hosting the 2018 Pyeongchang Winter Olympics, there are growing public concerns over the costs and possible ecological damage at the revered mountain.
Video

Video Xenophobia Victims in South Africa Flee Violence, Then Return

Many Malawians fled South Africa early this year after xenophobic attacks on African immigrants. But many quickly found life was no better at home and have returned to South Africa – often illegally and without jobs, and facing the tough task of having to start over. Lameck Masina and Anita Powell file from Johannesburg.
Video

Video Family of American Marine Calls for Release From Iranian Prison

As the crowd of journalists covering the Iran talks swells, so too do the opportunities for media coverage.  Hoping to catch the attention of high-level diplomats, the family of American-Iranian marine Amir Hekmati is in Vienna, pleading for his release from an Iranian prison after nearly 4 years.  VOA’s Heather Murdock reports from Vienna.
Video

Video UK Holds Terror Drill as MPs Mull Tunisia Response

After pledging a tough response to last Friday’s terror attack in Tunisia, which came just days before the 10th anniversary of the bomb attacks on London’s transport network, British security services are shifting their focus to overseas counter-terror operations. VOA's Henry Ridgwell has more.
Video

Video Obama on Cuba: This is What Change Looks Like

President Barack Obama says the United States will soon reopen its embassy in Cuba for the first time since 1961, ending a half-century of isolation. VOA White House correspondent Luis Ramirez reports.
Video

Video Hate Groups Spread Influence Via Internet

Hate groups of various kinds are using the Internet for propaganda and recruitment, and a Jewish human rights organization that monitors these groups, the Simon Wiesenthal Center, says their influence is growing. The messages are different, but the calls to hatred or violence are similar. VOA's Mike O’Sullivan reports.
Video

Video US Silica Sand Mining Surge Worries Illinois Residents, Businesses

Increased domestic U.S. oil and gas production, thanks to advances known as “fracking,” has created a boom for other industries supporting that extraction. Demand for silica sand, used in fracking, could triple over the next five years. In the Midwest state of Illinois, people living near the mines are worried about how increased silica sand mining will affect their businesses and their health. VOA’s Kane Farabaugh has more in this first of a series of reports.
Video

Video Blind Somali Journalist Defies Odds in Mogadishu

Despite improving security in the last few years, Somalia remains one of the most dangerous countries to be a journalist – even more so for someone who cannot see. Abdulaziz Billow has the story of journalist Abdifatah Hassan Kalgacal, who has been reporting from the Somali capital for the last decade despite being blind.
Video

Video Texas Defies Same-Sex Marriage Ruling

Texas state officials have criticized the US Supreme Court decision giving same-sex couples the right to marry nationwide. The attorney general of Texas says last week's decision did not overrule constitutional "rights of religious liberty," and therefore officials performing wedding services can refuse to perform them for same-sex couples if it is against their religious beliefs. Zlatica Hoke reports on the controversy.
Video

Video Rabbi Hits Road to Heal Jewish-Muslim Relations in France

France is on high alert after last week's terrorist attack near the city Lyon, just six months after deadly Paris shootings. The attack have added new tensions to relations between French Jews and Muslims. France’s Jewish and Muslim communities also share a common heritage, though, and as far as one French rabbi is concerned, they are destined to be friends. From the Paris suburb of La Courneuve, Lisa Bryant reports about Rabbi Michel Serfaty and his friendship bus.
Video

Video Saudi Leaks Expose ‘Checkbook Diplomacy’ In Battle With Iran

Saudi Arabia’s willingness to wield its oil money on the global diplomatic stage appears to have been laid bare, after the website WikiLeaks published tens of thousands of leaked cables from Riyadh’s Ministry of Foreign Affairs. VOA's Henry Ridgwell reports.
Video

Video In Kenya, Police Said to Shoot First, Ask Questions Later

An organization that documents torture and extrajudicial killings says Kenyan police were responsible for 1,252 shooting deaths in five cities, including Nairobi, between 2009 and 2014, representing 67 percent of all gun deaths in the areas reviewed. Gabe Joselow has more from Nairobi.

VOA Blogs