Japan plans to reduce the excise tax or accelerate capital flows to the technology unit

On 29 July, Louis Chua of the Economics of the Bank of Boldsing, Switzerland, indicated that the planned reduction of the food consumption tax in Japan was expected to benefit retailers and catering enterprises. In response to rising cost-of-living concerns, which have led to public acceptance of inflation management, the Government has committed to reducing the food consumption tax from 8 per cent to 1 per cent, effective April 2027. Chua expects that retailers, especially supermarket operators, discount chains and food-based pharmacies, will benefit most. Catering enterprises with pricing rights, the ability to maintain prices or transfer higher costs without compromising sales may also benefit. Switzerland added that increased market volatility could accelerate funding in the short term, from the rotation of technology units to defensive blocks and firms focused on domestic demand. Kim Xian