Posts Tagged ‘Democratic Party of Japan’

Candidate deposit requirement guarantees same faces on the ballot

Friday, October 26th, 2012

Ever wonder why so many Japanese politicians are old and that the only new faces tend to be their progeny? There are a number of cultural explanations for this phenomenon, but there’s also a financial one. It’s called the kyotakukin, or deposit, system.

The candidacy … paid in full (or How much is that politician in the window)

To run for any office in Japan, whether national or local, a person must deposit a certain amount of cash with the relevant election authorities. If the person wins, the deposit will be returned, but if the candidate loses and in the process fails to garner a certain percentage of the votes cast, he or she forfeits the money. The amounts required are high, and for national office almost prohibitively so. Candidates for prefectural and municipal office need to pay deposits of between ¥300,000 and ¥600,000, depending on the size of the constituency. However, candidates for the Lower House of the Diet have to deposit ¥3 million for a constituency seat and ¥6 million for a proportional seat. Constituency seats are decided for an electoral district simply by the number of votes cast in the district. Proportional seats are decided by the portion of votes a particular party receives on the proportional part of the ballot.

Many candidates, in order to guarantee success, run in both contests, because while they may lose in the constituency race, their party may gain a large enough portion of votes to allow them to be swept into office on the proportional ticket. In that case they have to pay deposits for both seats, meaning ¥9 million. If a constituency candidate doesn’t garner at least 10 percent of the total votes, he or she has to forfeit the deposit.

A few other countries have candidate deposit systems, but Japan’s is the most expensive by far. According to a recent article in the Tokyo Shimbun, the United Kingdom only requires the equivalent of ¥62,000 to run for national office, Canada ¥80,000, and Korea about ¥1 million, the highest after Japan. Most democracies either never had the system or have done away with it. Historically, its purpose was always obvious: to limit the number of candidates and make sure that those with financial power also held political power.

Continue reading about election campaign deposits →

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.

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