TOKYO (AFX-ASIA) - Finance Minister Masajuro Shiokawa said the Japanese economy remains in a severe condition, given recent economic data, but fundamentals are not deteriorating.
"Since I took office, the economy has continued to be in a severe situation," Shiokawa told a regular press conference.
"However, I am confident that economic fundamentals are still firm and we see the current severity being short-lived. I believe there will be a trigger for improvement in the future," he said.
Yesterday, the ruling Liberal Democratic Party's policy chief Taro Aso and coalition New Komeito policy chief Kazuo Kitazawa were reported to have agreed on a new equity-capital gains tax system. However, Shiokawa said the ministry had not yet received any details of the agreement.
"We have not yet received any such notice from the LDP but I think the two parties have agreed that they will start discussions about that," Shiokawa said.
"The government is still considering merging the existing dual tax into a single tax-return based charge in two years," he said. "The rate of the tax should be balanced with that of tax on interest income (currently 20 pct)."
Asked whether he plans to lower the rate further, Shiokawa said: "At present, we are not yet examining that possibility. However, we want to consider measures that help individual investors to enter the market more easily."
He added, that for the year to March 2003, the Ministry of Finance, "will not accept budget requests from ministries and agencies above the level of the previous year."