Archive for the ‘Family matters’ Category

Summertime blues: no place to go or no money to spend?

Friday, August 10th, 2012

Last week, the research department of Meiji Yasuda Life Insurance released the results of its annual summer vacation survey. For the second year in a row, projected spending for summer vacation dropped from the previous year’s spending. On average, households say they plan to spend ¥82,974 this year, down from ¥84,848 last year. It is not the lowest amount on record, however. In 2008, households said they would spend ¥76,955, but that was the year after the subprime crisis and the Lehman Brothers “shock.” The next year, spending recovered but has been declining ever since.

What the roads won’t look like in the middle of August.

Yasuda hasn’t analyzed these findings, so it’s not entirely clear if the reason for the decline is lack of disposable income due to the ongoing recession or fear of spending any money because of an uncertain future. However, the amount of spending jumps considerably when children aren’t involved. Households consisting only of couples said they would spend on average ¥100,191, which is much more than it was last year. A relatively large number of couples say they will be traveling overseas.

In any case, the majority of all respondents said they would stick close to home this summer, 62 percent, to be precise. It’s the seventh year in a row that “staying at home” topped the list of answers to the question, “What do you plan to do?” Other answers (respondents can tick more than one) included “return to my home town” (39.4 percent), travel domestically (37.4 percent), and visit theme parks, public pools, camping sites, etc. Among the reasons given for staying at home this year, the most common was “to recover my strength,” followed by “it costs too much to travel.”

It’s unfortunate that Yasuda didn’t get even more detailed in this line of inquiry. For example, of the people who said they would visit their home towns, 52 percent also said they would get there by automobile. Considering the monumental “u-turn rush” traffic jams that occur during the specified holiday period, it might have been interesting to find out how many people decided not to go home because of traffic jams and crowded trains. It’s easy to blame apathy about summer vacation on economics, but logistics has a lot to do with it, too, especially when they’re qualified by financial considerations. These things all go together.

Wag the dog: Pooch tax more than just a source of revenue

Wednesday, July 25th, 2012

You talkin’ to me?: Sign asking apartment residents to clean up after their dogs

Like a lot of Japanese cities, Izumisano, in Osaka Prefecture, has a problem with dog doo. People aren’t properly cleaning up after their pets, and last year the city government passed an ordinance that would levy an immediate ¥1,000 fine on people who didn’t. The ordinance has gone into effect but there’s one problem: No staff to patrol and issue the summonses. So far not one fine has been levied much less collected. Obviously, the city needs to hire people to carry out the patrols, but like almost every other municipality in the country, Izumisano is short of funds, so the mayor proposed a tax on dog owners to pay for the patrol. The idea was met with overwhelming support from the citizens.

No one bothered to break this support down into people who own dogs and those who don’t, but according to the magazine Aera, these days almost any tax proposal is met with automatic opposition, even from those it doesn’t target. But everybody in Izuminosano thinks this tax is a good idea, including animal welfare groups, which would conceivably shoulder an extra financial burden if the tax is carried out unless it specifically excluded organizations such as private shelters. One such group told Aera that it’s important to enlighten people to the responsibility attendant on dog ownership, especially with regard to a dog’s impact on the environment and public sanitation. The group thinks that a dog tax would be a good way to raise such awareness, in addition to collecting money that can be used for animal welfare.

Continue reading about a proposed tax on dogs →

Boomer boom: Businesses tapping consumption where they can find it

Friday, July 20th, 2012

It’s 10 a.m. Do you know where your grandmother is?

In July, the Bank of Japan released the results of its quarterly tankan survey of business sentiment for April-June. The most notable, and hardly surprising, result was the drop in confidence among major manufacturers. Less was said about the fact that domestic demand and individual consumption appear to be stabilizing. The numbers get even more encouraging when you look at specific industries.

In the tankan, an index of “0″ means no change in sentiment, with minus numbers indicating a loss of confidence and positive numbers a gain in confidence. The index for hotels and restaurants was +3, the first positive rise in five years, and a substantial one. Even more impressive was the index for “individual services,” such as travel agents, a category launched in 2004. The most recent tankan showed an index of +25. These numbers are at once heartening and baffling. Average income did not rise during the same period, which means consumption shouldn’t have risen, so why the increase in confidence?

The report’s authors credit these hopeful signs to people over 60, and smaller businesses’ resourcefulness in tapping this demographic. A recent article in Tokyo Shimbun profiled an izakaya (drinking establishment) chain called Hokkaido, which has an outlet in Kokubunji, Tokyo, that offers a special hiru enkai (daytime party) plan: If each member of a party orders at least ¥3,500 in dishes, then the party can drink as much as they like without paying extra.

Continue reading about senior citizen consumers →

Japanese laws make abortion an economic issue

Sunday, May 13th, 2012

Women’s clinic in Chiba Prefecture

Contrary to what most people believe, abortion in Japan is not legal. The reason abortions are performed freely in Japan — 210,000 were reported in 2010, but the number is probably higher — is that shortly after the war the dataizai (illegal abortion) law was exchanged for the Eugenics Law to address the population boom. This law allowed for a pregnant woman to abort her child only if the pregnancy threatens her life or health, or if the woman is financially unable to raise the child. It did not make abortion a right available to any woman who wanted one.

It is thus assumed, for legal purposes, that the vast majority of women who undergo abortions do so for economic reasons. However, since there is no real provision for having women state their reasons when seeking abortions, and no woman in Japan has been prosecuted for aborting a fetus since World War II, abortion is considered effectively legal. It is also quite expensive. Unless the procedure is being carried out specifically for health reasons, national insurance will not cover it. This situation has lead to a paradox: Most women in Japan who seek abortions ostensibly do so because of financial hardship, but are nevertheless forced to pay a great deal of money to have those abortions performed.

According to our own Internet survey of gynecology services and comments on various blogs and websites, the cost of an abortion up to the 12th week of pregnancy ranges from ¥80,000 to ¥150,000, which is only the cost of the procedure and does not include consultation fees and medication. However, after the 12th week of pregnancy, the cost increases considerably. Abortions performed between the 12th and 22nd week of pregnancy are between ¥300,000 and ¥500,000. Also, if the patient suffers from a chronic condition that could complicate the procedure, such as asthma, she is required to undergo the procedure at a general clinic, which tends to be more expensive than a women’s clinic or a gynecology office.

Of course, if a physician concludes that the pregnancy threatens the woman’s life or health, insurance can be used for the abortion; and if the cost of the operation goes above a certain level, she can receive a refund for any money she pays out of pocket. Even if the cost does not rise above that designated level, if she files an income tax return she can deduct the cost of her abortion on her return, including money she paid for sanitary napkins and even the taxi fare to the clinic. But this is only if the procedure was done for health reasons. Other costs that apply but usually aren’t mentioned have to do with the aborted fetus. If an abortion (or miscarriage) takes place after the eleventh week of pregnancy, the attending physician has to fill out a death report which the mother then files at the local city office. After that she has to pay for cremation. There is also mizuko kuyo, or memorial services for aborted babies, which are completely optional, though some parties have tried to make a business out it.

Continue reading about the price of abortions in Japan →

Ruling party ends up back where it started with assistance for families

Friday, April 27th, 2012

We’re almost a month into the new fiscal year so it’s high time to review any changes in the cost of living for the average person in Japan. Not counting consumer spending, for the most part the change is negligible. Premiums for national health insurance have gone up for those who belong to the kyokai kenpo system, meaning mainly employees of small and medium-sized companies, from 9.5 percent to 10 percent of salary amount, which works out, on average, to an extra ¥780 a month. The long-term nursing care insurance payments (kaigo hokenryo) for persons aged 40 to 64, whether employed or not, have increased from ¥4,516 to ¥4,697 a month. Reflecting deflationary trends, payouts of basic pension have been reduced by 0.3 percent, but premiums have gone down from ¥15,020 a month to ¥14,980. Unemployment insurance has also been cut from 1.2 percent to 1 percent of salary amount. Utilities are going up. Electric bills will increase from ¥17 to ¥42 a month for an average family, and gas bills will increase from ¥8 to ¥11 a month.

Surprise! Local tax bill for Arakawa Ward, Tokyo, first quarter fiscal 2011

These changes won’t have a major effect on the average household. But one change that may is the shift in tax rules related to the child allowance (jido teate), which was one of the central proposals of the Democratic Party of Japan’s manifesto when it became the ruling party. The DPJ won on the assumption it would pay out ¥26,000 a month per child. By the time the opposition parties got through tearing the proposal apart, the amount had been cut in half, but that payout only lasted a year.

Starting in April, the allowance, which used to be called kodomo teate — the change to jido was supposedly implemented to placate the Komeito Party, who originally came up with the idea years ago under that name — will pay ¥15,000 a month for a child under 3 years old; ¥10,000 a month for the first two children in a family from the age of 3 until they graduate from elementary school; ¥15,000 a month for each child after the second one in the same age group; and ¥10,000 a month for each child in junior high school.

However, in order to get the opposition to accept even this reduced child allowance system, the DPJ had to abolish the dependent child tax deduction starting with tax returns for fiscal 2011, which were just filed this spring. In effect, it means that parents can no longer claim children up to high school, meaning less than 16 years of age, for a tax deduction since they are eligible for the child allowance. High school age children are not eligible for the child allowance so they can still be used as a tax deduction, but the amount of the deduction has been reduced from ¥630,000 to ¥380,000, because the government has now made high school free for everyone, including students who attend private institutions.

Where this change will be felt most immediately is on the local tax (juminzei) bills everyone receives in June. Local tax is calculated based on the national tax returns filed by the middle of March, so because these dependent child deductions no longer apply, individual households’ taxable incomes will increase, meaning the households will see an attendant increase in their local tax bills. Of course, it also means higher taxes on the national level, too, but since these changes weren’t implemented until last fall and salaried workers’ taxes are calculated by the bookkeeping departments of the companies/organizations they work for, they probably didn’t notice the slight monthly increase in their pay statements. They will certainly notice it on the local tax bills, since it shows the amount for the entire year. (It also affects the premiums paid for national health insurance since premiums are based on the previous year’s taxable income.)

So what does this mean in yen terms for the average family? According to the Ministry of Health, Labor and Welfare, taking into consideration both the child allowance payments and the boost in tax liabilities caused by the loss of the child deduction, an average family consisting of one breadwinner earning ¥3 million a year, one full-time homemaker and one child will end up with ¥667 more per month than they had before the DPJ came to power. The same family making ¥5 million a year will end up with ¥375 less per month. If income is between ¥8 and ¥10 million, the average loss is ¥4,083, and if it’s over ¥15 million it’s an average deficit of ¥8,200 a month. To put it another way, according to Sankei Shimbun, the average family making more than ¥4.88 million a year will, on balance, pay more than they did before the DPJ was elected. It’s as good an illustration as any of where politics gets you.

Government shows awareness of something called ‘child support’

Friday, April 20th, 2012

Divorce in Japan can be ridiculously easy. If the two parties are in agreement about breaking up, all they have to do is go down to their local government office, fill out a rikon todoke (divorce notification) and give it to the Man. No fuss, no muss, no grounds. In fact, both parties don’t even have to be present, as long as their seals are affixed to the document. About 90 percent of all divorces are carried out in this “mutual consent” (kyogi-teki) way.

Page 2 of divorce notification with "minor child" box in lower right corner

Starting this spring, however, the notification form has a new box in the lower, right-hand corner. The box concerns “minor offspring.” If the couple has a child under the age of 20, they are required to check this box, though if they don’t nothing will happen. The divorce will still go through. According to a recent article in the Tokyo Shimbun, when someone goes into his or her city hall and asks for the divorce notification form, the clerk is supposed to explain the purpose of this new box and encourage the person to check the appropriate statements if he or she has children, but in principle such disclosure is voluntary.

The purpose of the new box is to promote greater awareness of children’s position in a divorce with regard to visitation and child support. The Ministry of Health, Labor and Welfare has said that children’s welfare should be prioritized by parents who are divorcing, and the box is a nudge to get them to at least think about visitation and child support before they finalize their divorce.

As it stands, both concepts are still very weak in Japan. In a 2006 survey conducted by the ministry, only 34 percent of single parents who went through mutually agreed upon divorces (meaning no lawyers, mediation or courts) said they had made verbal agreements with their ex-spouses to the effect that the latter would pay something in the way of child support. However, in reality, less than 19 percent actually paid, and 60 percent of all divorced custodial parents have never received any assistance from their ex-partners at all.

In the United States it’s the opposite: 60 percent of custodial parents receive child support from the non-custodial parent. In 2005, the average amount of this support was $6,200 a year, regardless of how many children are being supported. In Japan, the average child support payment among non-custodial parents who actually do pay is ¥42,000 a month, which works out to be about the same. According to research carried out by the Japan Institute for Labor Policy and Training, in the U.S. when custodial parents don’t demand child support it’s usually because they don’t need it; while in Japan a custodial parent usually doesn’t demand it because she doesn’t think her ex-partner can pay. In such situations, they don’t even think about alimony.

Continue reading about child support in Japan →

Outlet malls another American concept that may not work in Japan

Monday, April 16th, 2012

Can't get there from here: empty storefronts at Big Hop Garden Mall

This weekend marks the grand opening of Mitsui Outlet Park Kisarazu, a so-called outlet mall in the coastal city of Kisarazu in Chiba Prefecture. So far the mall has 171 stores, including 21 retailers that have never before participated in any Japanese outlet mall. Mitsui Fudosan, which developed and manages the facility, says it hopes to eventually have 250 stores in the mall. Its sales target for the first year is between ¥32 billion and ¥34 billion, which would make it the biggest money-maker of the 12 outlet malls the company operates.

Mitsui isn’t the only developer staking its future on the success of American-style suburban shopping complexes. In Japan there are now 39 outlet malls, which are characterized by stores that are directly owned and run by manufacturers. In principle, that means cutting out one or more middlemen and offering greater savings on name-brand goods. According to the most recent statistics we could find there are more than 1,600 “shopping malls” in Japan, though most of these are urban complexes that vary significantly in style and form from the classic American-style shopping mall.

Nevertheless, over the past decade or so, the number of shopping malls has increased in suburban areas as more traditional shopping arcades (shotengai) have declined in number or even vanished. The main features of these suburban shopping malls is one or two large “anchor” retailers, usually a department store and/or major supermarket chain, and, most significant for Japan, the fact that they aren’t located near train stations, where land is more expensive. That means they target motorists and feature the sort of enormous parking lots that are ubiquitous in the United States but which, until recently, were unheard of in Japan.

Outlet malls don’t always incorporate major department stores or supermarkets, but they do cater to people with cars. This aspect is particularly noteworthy in the case of the new mall in Kisarazu, which is the eastern terminus of the Aqua-Line bridge-and-tunnel route that connects Chiba’s Boso peninsula to Kanagawa Prefecture over Tokyo Bay. When this very expensive, 23-km highway was completed in 1997, one of its main purposes was to encourage visits to Kisarazu and the rest of Chiba by residents of Tokyo and Kanagawa, which includes the very large cities of Kawasaki and Yokohama.

That didn’t happen. Most of the traffic actually went the other way, if it went at all. When it opened, the toll was an intimidating ¥3,000 each way. As part of his election campaign platform, current governor Kensaku Morita promised to persuade the land ministry to reduce the toll, and now it’s only ¥800 one way (as a “test discount” that appears to be permanent), but still the tourists weren’t coming to Kisarazu. Instead, they went to the restaurant and retail complex built in the middle of the Aqua-Line. The Aqua-Line itself became the attraction, not the cities on either end of it.

Continue reading about shopping malls in Japan →

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