Press Conference by Shozaburo Jimi, Minister for Financial Services

(Excerpt)

(Friday, November 19, 2010, from 8:38 a.m. to 8:44 a.m.)

[Opening Remarks by Minister Jimi]

I have nothing in particular to report to you today.

[Questions & Answers]

Q.

In the Government Tax Commission, disapproving judgments are coming out one after another with respect to the securities tax break and other matters associated with the Financial Services Agency (FSA).  How are you receiving them?

A.

The Tax Commission conducted its first and second rounds of assessment the other day and I have learned from newspaper articles and other sources that, as you have just pointed out, it has concluded that an extension of the reduced securities tax rate should not be approved.  Considering, though, that the issue was discussed as one of the main topics at the November 11 Tax Commission meeting, with a decision that it should be further discussed, I have trouble understanding this disapproval of the proposed extension of the reduced tax rate.

In view of the severe economic and financial circumstances that currently exist, the apprehension for possible downturns in the future, or the issue of double taxation of dividends, the FSA is currently lobbying hard to have the reduced securities tax rate extended and is committed to continuing to work hard to gain support from those who are concerned with the matter.  The double taxation problem has been around for quite some time, which, in the case of a company, is a problem of having its corporate income assessed for corporate income taxes and then assessed again for dividend taxes if it is used for dividend payment purposes.

As leaving deflation behind is the greatest challenge of the present times, we believe that ensuring a vibrant securities trading market is a very important matter, indeed.

(End)