Posts Tagged ‘Liberal Democratic Party’

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 →

Tobacco farmers lost but not forgotten in tax rumble

Monday, January 2nd, 2012

Smoke 'em if you got 'em: JT HQ in Toranomon, Tokyo

As every smoker in Japan knows, the cigarette tax was raised in the fall of 2010. With ¥3.5 added to each cigarette, it means a pack suddenly cost at least ¥70 more, and as a result sales have dropped by about 20 percent. So-called sin taxes are double-barrelled: They have a behavior modification purpose of discouraging users from over-indulging, and they’re an easy political sell since the consumers (and maker/providers) usually aren’t considered a sympathetic or powerful constituency by the general public. Consequently, the government is thinking of adding another ¥2 per cigarette tax levy to help pay for reconstruction.

The suggestion has been tabled for the time being, though it will likely be revived. The main reason for the postponement isn’t so much Japan Tobacco, which has a monopoly on tobacco sales in Japan, but rather the farmers who supply JT. There are approximately 10,000 households that make a living from growing tobacco, and about 40 percent have said that they plan to quit since they see no future in the crop. The presumed reason is the tax and the trend for quitting, but many farmers say they are getting out of tobacco because JT asked them to. Since JT is obliged to buy all their product, these farmers no longer have a guaranteed future, and with the Trans-Pacific Partnership possibly looming on the horizon, there’s even less of an incentive to stick it out.

Tobacco, like salt and rice, used to be a government monopoly. That changed in 1985 when the monopolies were abolished and Japan Tobacco was established. Despite the change in nomenclature, JT pretty much continued to operate as a monopoly, since it had to buy all the tobacco produced and controlled all sales of cigarettes. JT determined the price of tobacco before each growing season, meaning there was never a market for the crop. This worked fine while sales were strong, but after they peaked in the mid-90s revenues steadily decreased. Starting in 2004, JT solicited tobacco farmers to retire, and about 20 percent did exactly that. The amount of farmland dedicated to tobacco decreased by about 10 percent. Last year, JT asked more farmers to quit the game, and the decrease in farmland was 30 percent.

Continue reading about a possible hike in tobacco tax →

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