The auto market in Japan is forecasted to increase in the coming year, after a period of decline, country’s automobile lobby says.
Sales of new cars, trucks and buses are expected to rise 6.5 percent in Japan in the year beginning April, as customers will rush to buy ahead of a rise in consumption tax expected next year, the Japanese Automobile Manufacturers Association said. The lobby sees domestic sales rising to 5.26 million in the coming year, after a 6.8 percent projected drop in the year ending this month. It would be the second consecutive year in which the country’s auto market would slide, following government’s decision to raise the consumption tax to 8 percent from 5 percent in April 2014, while a further increase to 10 percent is expected in April 2017.
The automakers have strongly supported the dropping of such duty, as they claim that the overcharging is not helping at all the automotive industry in the country, as well as the economy, since the buyers already pay a national sale tax when purchasing a vehicle. They warned the government that a further toll will have a negative impact on domestic production and, in a comparison with the US levies, the Japanese car owner has to pay taxes almost five times higher, according to association estimates. The new government’s plan includes four grades of tax rates from zero to 3 percent for regular vehicles and will be based on fuel efficiency.