Archive for the ‘Lifestyle’ Category

Casino tax study exposes pachinko to greater scrutiny

Monday, September 8th, 2014

Where's the money? Pachinko patrons at an off-site exchange booth

Where’s the money? Pachinko patrons at an off-site exchange booth

In line with plans to make casino gambling legal in Japan, the government needs to come up with some sort of scheme to tax gambling receipts, but even before they do that they have to address another problematic potential revenue source: pachinko. As it stands, pachinko winnings are not taxed and pro-casino forces are thinking of implementing a 1 percent levy on those winnings, so they went to the National Police Agency and asked for figures to see what kind of tax revenues they could expect. An NPA representative told them, seemingly with a straight face, that they don’t keep such statistics since there are no winnings.

Classic pachinko is like pinball in that the player earns points by being able to send balls into certain holes, which gives him more balls to play with. In gambling terms, a player wins when he ends up with more balls than what he started with. However, pachinko parlors cannot reimburse the player for the balls he wins. Instead they give him tokushu keihin (special premiums) — ball point pens, lighter flints, etc. — in exchange for balls. Then, he can take those premiums to an off-site, unaffiliated shop that buys them with cash. The shop then sells the premiums back to a wholesaler, which, in turn, redistributes tham back to pachinko parlors.

This “three-shop exchange system” (santen kokan hoshiki) bypasses anti-gambling laws because the venue where the customer plays the game does not offer cash rewards. Everyone understands this system and how it works, but the police representative told the group of lawmakers that they don’t have figures because “we don’t know anything about places” where pachinko players exchange prizes for money.

According to the Asahi Shimbun, the lawmakers were “disgusted” with this ingenuous display of “tatemae” (official principle). The group, established last February, believes a 1 percent tax on pachinko winnings would generate ¥200 billion a year in revenues for the government, which is important since the present administration has decided to reduce the amount of corporate tax it collects and has to make up the shortfall somehow. Consequently, according to the Asahi, these lawmakers have to “destroy” the illusion that people don’t exchange pachinko balls for cash, which means they have to publicize the three-shop system and explain it for what it is, which is gambling by indirection.

The system was devised in Osaka in the 1960s. At the time, players exchanged the premiums they won for cash directly from organized crime members. Later, the police forced underworld elements out of the business and entrusted the exchange system to local chapters of the Japan War-Bereaved Families Association, which consists of people who lost heads-of-household and other loved ones on the front lines in World War II.

It was a form of public welfare, and at this point the NPA acknowledged, albeit tacitly, that pachinko exchanges weren’t strictly illegal any more. Eventually, they set up their own bureaucratic organization, the Pachinko Gyokai Dantai (Pachinko Industry Group), and staffed it with retired NPA officials to administer the exchange system. Some media have said that profits from the system go into the police pension fund and other NPA-related schemes. In any case, the police have never allowed anyone outside this organization to have anything to do with the system.

So if the government passes a law to tax pachinko winnings it would be an automatic admission that pachinko is gambling, so there is a fundamental disconnect between the government and the police with regards to the game. This could spell trouble for the proposed Casino Promotion Law, since foreign companies want to invest in casinos but will certainly ask why their businesses are taxed and pachinko parlors aren’t. That’s why the government wants to clarify the situation. On July 24, lawmakers essentially told the police that if they cooperate they won’t be held responsible for the last 30 years of looking the other way with regards to a semi-legal gambling system, but the NPA seems loath to admit as much.

In a separate interview with the Asahi, pachinko writer Pokka Yoshida explained the situation in more detail, saying that the the police-controlled Pachinko Gyokai Dantai isn’t, as some may think, corrupted by the pachinko industry itself. In actuality, they control the industry, which is in thrall to the three-shop exchange system. If the police take that system away, the industry is nothing, so they do anything the police ask.

In Yoshida’s words, the pachinko industry is in a constant state of crackdown. The relationship started in 1985 when the Law to Regulate Businesses that Affect Public Morals (fuzoku eigyo-ho) was revised. Police said they were going to be more aggressive about controlling pachinko, and later introduced a prepaid card system for buying pachinko balls in parlors.

The person who promoted this system was Katsuei Hirasawa, a Diet politician who was once an NPA bureaucrat. The idea was to understand exactly how much money pachinko parlors were making, since the industry was famous for fudging accounts and evading taxes and sending money to North Korea, where many people in the industry had families. In order to spread the use of prepaid cards, the police controlled the manufacture of certain new types of pachinko machines that allowed proprietors to adjust the odds of winning so that they could “incentivize” their parlors: Players are always looking for machines with better odds of winning. Police made sure that when these machines were manufactured, they couldn’t accept cash, only prepaid cards.

When pachinko became a “social problem” in the late ’90s, according to Yoshida, the police, through the PGD, had some 700,000 “socially problematic” machines removed from parlors. As it happens, these were cash machines, thus establishing the prepaid card system as the standard. But now, Yoshida says, the actual pachinko industry is trying to get away from police control, and so they are working with “the political world” behind the scenes to break free of the PGD. The police, understandably, are resisting.

Prep schools succumbing to more than economic reality

Monday, September 1st, 2014

In recent weeks the yobiko Yoyogi Seminar announced that it would be closing 20 of its 27 schools nationwide by March of next year. The reason is clear and has been for years: enrollment is dropping with no bottom in sight.

Yoyogi Seminar in Tsudanuma, Chiba Prefecture, which is one of the branches scheduled to close

Yoyogi Seminar in Tsudanuma, Chiba Prefecture, one of the branches scheduled to close

The term “yobiko” is sometimes translated as “cram school” and sometimes as “prep school,” and so they tend to be mixed up with juku, another education-related term translated as “cram school.” Practically speaking there is no real difference, since both forms of enterprise prepare students to take entrance tests for higher institutions of learning. But juku tend to be associated with elementary school and junior high school students, while yobiko are more often attended by high school students who want to get into name universities.

Just as often they are used by high school graduates who are doing the same. Since these grads are not attending a for-credit school at the time, they are referred to as ronin, the word that described masterless samurai in the past. And in a sense it is the loss of ronin that made Yoyogi Seminar realize its future was in jeopardy. This past spring, according to the education ministry, 80,000 ronin took college entrance tests. In 1994, the number was 280,000.

The obvious reason for the loss of ronin is that the so-called “narrow gate” for entering universities has widened over the years. As the birthrate continues to remain low the number of available students has dwindled, and at the same time the number of universities has actually increased, from 552 20 years ago to 781 as of the beginning of this year. Schools, especially those lower on the prestige scale, are desperate for paying students and thus have eased requirements for admission. Some don’t even require tests any more, but accept recommendations or school performance records. And without the entrance testing system most yobiko have no reason to exist.

CONTINUE READING about cram schools and ronin →

European winemakers fret over competition from Chile

Monday, August 25th, 2014

The competition: Wines from Australia, Chile and France with retail prices below ¥1,000

The competition: Wines from Australia, Chile and France with retail prices below ¥1,000

During the first half of the year, sales of wine from Chile exceeded those of wines from Italy, thus making Chilean wine the second most popular imported wine in Japan, and apparently, Chile is now gaining rapidly on No. 1, France. The main reason is the Chile-Japan Economic Partnership Agreement signed in September 2007, after which the tariff on Chilean wine started to decrease gradually from the standard duty on foreign wines of either 15 percent of import price or ¥125 per liter. Right now the tariff rate for Chilean wines is 5.8 percent, and it will be zero in April 2019.

According to a Jiji Press report, the further the tariff drops, the more sales increase. More significantly, the amount of wine being imported has gone up. In 2007, when the EPA went into effect, Japan imported 10,517 kiloliters. But 2013, the volume was 36,435 kiloliters, which is an average annual growth rate of 20 percent. For the first half of this year alone, 17,349 kl entered Japan, and since the end of the year is the big season for wine, it’s clear that this year’s volume will exceed last year’s. And note that France exported 19,093 kl to Japan in the first six months of 2014.

Nevertheless, importers have told Jiji that the EPA isn’t as big an influence as it seems. One wine industry association said that Chile’s product is more suited to Japanese tastes, whatever that means. But the fact is that other wine-making countries and regions are paying close attention to the Japanese market and may be worried about Chile’s ascendance. For one thing, while sales of alcoholic beverages in general have been on the decline, the consumption of wine has been going up. At present, the average Japanese person consumes a little less than three bottles a year. Consequently, Japan signed another EPA with Australia in July. According to the terms of the agreement, the tariff on Australian wine will disappear in seven years, which is faster than the rate reduction with Chile.

So Europe is especially anxious to get its own EPA hammered out, since it’s losing ground to these New World winemakers. Wine and cheese are two of the main products under discussion.

It may already be too late. According to a report in the Hokkaido Shimbun, Hokkaido Prefecture’s most prominent convenient store chain, Seico Mart, has seen a 10 percent increase in the sale of Chilean wines over the past year, or one-fourth of the chain’s entire wine sales revenue. That’s even more than French wines. The newspaper narrows the appeal down better than Jiji, saying that Japanese people prefer the slightly sweeter flavor of Chilean wine. But the real reason is the price. The bestselling wine in the chain is a Chilean wine that goes for ¥480.

A common retail belief when it comes to selling wine to people who aren’t connoisseurs in Japan is that ¥1,000 tends to be the limit, and Chilean wine is consistently below that ceiling.

A modest proposal for alleviating the endangerment of Japanese eels

Sunday, July 27th, 2014

Fish fans: People waiting in line at a popular eel restaurant near Minami Senju Station in Tokyo

Fish fans: People waiting in line at a popular eel restaurant near Minami Senju Station in Tokyo

This year, doyo no ushi no hi, the “day of the ox,” falls on July 29 in accordance with the old Chinese calendar. Counterintuitively, Japanese people don’t celebrate the day by eating beef but rather eel, because, supposedly, eel, or unagi, helps maintain a person’s stamina during the hottest days of summer. But it should be noted that the custom of eating eel is commercial in origin. According to legend, the tradition started in the 18th century in Hino, Western Tokyo, where nobody ate eel because the fish was a kind of local deity. An inventor named Hiraga Gennai came up with a publicity campaign to get people to eat unagi on doyo no ushi no hi because both ushi and unagi start with the “u” sound. The campaign worked, and now everybody eats unagi on doyo no ushi no hi. Well, maybe not everybody, but enough to drive Japanese eel to the brink of extinction.

Japanese eel for consumption are caught in the wild as fry and transported to eel farms throughout Asia. Eel is now on the International Union for Conservation of Nature‘s endangered red list, and so the environment ministry made the same designation on its list of at-risk species. However, this information has been tempered somewhat lately by media reports saying that the eel catch was higher this past year, thus driving the price of imported eel, mainly from China and Taiwan, down considerably. Consequently, eel dishes on the 29th may be cheaper in some places than they were last year.

Unagi fans will see this as good news, but it isn’t. The reason eel is on the endangered list is that Japanese people catch and eat too much of the fish, which wasn’t the case before the mid-1980s, when eel was considered something of a delicacy eaten only on special occasions. In other words, the cheaper the eel, the more likely eel stocks will be decimated.

CONTINUE READING about the unagi shortage →

The new National Stadium will have to rock you

Sunday, June 8th, 2014

The show must go on: Attendees of a sayonara event at the National Stadium snap photos of an air show held on June 6.

The show must go on: Attendees of a sayonara event at the National Stadium snap photos of an air show held on June 4. KYODO

The old National Olympic Stadium in Tokyo closed down at the end of May with a big sendoff: two days of star-packed concerts in front of a capacity crowd. As everyone knows, the venue is being torn down to make way for an even bigger structure for the 2020 Tokyo Olympics, an endeavor that continues to court controversy due to its projected size and cost, not to mention what it will likely do to the neighborhood around it.

Originally, the estimate for the new stadium was ¥300 billion, but mysteriously this figure was decreased to ¥169 billion just prior to the final bid. According to Professor Tomoyuki Suzuki, who was in charge of preparing Tokyo’s unsuccessful bid for the 2016 Games, construction costs for public facilities always end up rising over time, but neither the 2020 Tokyo bid organization nor the Japan Olympic Committee has ever explained that bit of conventional wisdom to the public. He told Tokyo Shimbun last April that the estimate was simply based on a number “that was most likely to be accepted.”

There is also the question of what to do with the stadium after the Olympics. The JOC is predicting that it will show a surplus of ¥400 million a year, but as Suzuki points out, this projection is based on the premise that the stadium will host 12 major pop concerts a year, and that, he believes, is impossible, unless the stadium foregoes sporting events, which is what it’s being built for in the first place.

The main problem with using stadiums for concerts, especially stadiums that hold field events like soccer, is that the playing surfaces are used for seating, which has a tendency to destroy the grass. Suzuki cites Ajinomoto Stadium in Western Tokyo, which is the home field of the FC Tokyo soccer team. In 2008, the stadium operators rented the facility to a promoter who held a rock concert attended by almost 80,000 people. Despite FC Tokyo’s protests, the concert went ahead, and afterwards the stadium had to spend “tens of millions of yen” to change the grass on the entire field in time for an FC Tokyo match.

CONTINUE READING about stadium rock to come →

Golden Week activity influenced more by logistics than by economics

Saturday, May 3rd, 2014

Too late to stop now: Travel brochures for Okinawa and Hokkaido

Too late to stop now: Travel brochures for Okinawa and Hokkaido

This year’s Golden Week holiday isn’t as golden as it normally is owing to the way the national holidays that make it possible fall in relation to the days of the week. Showa no hi (the Showa Emperor’s birthday) was on a Tuesday and Constitution Day on a Saturday, so there was enough time between them for people to work, which means they didn’t get those days off. That left a measly 4-day weekend to get all the things people usually do during Golden Week done — like visit their home towns — and the truncated time period meant more highway congestion in a shorter time span, which the media treats with such predictable urgency every year that it has become something of cultural touchstone. In any case, all that gasoline wasted in 45-km traffic jams and constant stops at expressway service areas doesn’t make up economically for the money lost during the reduced holiday.

The Japan Travel Bureau declared that the Golden Week holiday started on April 25 and ended May 6, despite the fact that, for the first half of that period, schools weren’t closed the whole time so it wasn’t a bona fide “break” for families with children, regardless of whether or not dad had to work.

According to a JTB survey of 1,200 people who presumably already knew what they were going to spend over the holiday, the amount expended per person for those who planned to travel domestically was ¥34,400, or 4.2 percent less than last year. For overseas travelers the amount was ¥249,500, which represents an increase of 8.1 percent. The peak days for domestic departures were May 3-4, and for foreign departures May 2-3, thus proving that the first half of the holiday was virtually meaningless. This concentration of recreation into such a short period will likely spawn even more post-GW stories than usual on the spike in attendant divorces and job resignations.

CONTINUE READING about Golden Week 2014 →

Some local governments think health checkups save money, and some don’t

Saturday, April 5th, 2014

Preemptive stride: If you do have metabolic syndrome you can guess what the doctor will tell you to do

Preemptive stride: If you do have metabolic syndrome you can guess what the doctor will tell you to do

Though there’s a minority opinion to the contrary, conventional wisdom says that regular health checkups are the only way to prevent the development of major illnesses, so, logically, they should also help reduce healthcare costs in the long run. This is the concept behind tokutei kenko kensa, or “special health checkups,” that were started six years ago by the Ministry of Health, Labor and Welfare. The main target is metabolic syndrome, the inevitable gain in fat that accompanies midddle age and which, unchecked, is thought to be the gateway to many so-called lifestyle diseases, like diabetes.

The idea is that local governments would provide checkups to insured residents between the ages of 40 and 74 with national insurance, which, in principle, doesn’t cover regular general health checkups since Japan’s public health system is designed to treat existing problems. If the special checkups uncover unhealthy situations, then the individuals are advised with regard to better diets or exercise regimens, or even pharmaceutical assistance, so as to head off costly treatment down the road, like, for instance, dialysis, which can cost on average ¥5 million a year, most of which ends up being paid for by the government, both local and central.

CONTINUE READING about health checkups →

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